Preamble

The House met at half-past Two o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

PRIVATE BUSINESS

GREATER MANCHESTER (LIGHT RAPID TRANSIT SYSTEM) BILL [Lords] (By Order)

Order for Second Reading read.

To be read a Second time tomorrow.

Oral Answers to Questions — ENVIRONMENT

Earth Summit

Dr. Strang: To ask the Secretary of State for the Environment what representations he has received about the role played by the Government at the Earth summit in Rio de Janeiro; and if he will make a statement.

Mr. Bayley: To ask the Secretary of State for the Environment if he will make a statement on the outcome of the UN Conference on Environment and Development in Rio de Janeiro.

The Secretary of State for the Environment (Mr. Michael Howard): I refer the hon. Members to the full statement made on Monday by my right hon. Friend the Prime Minister. The successful outcome of the conference, and the constructive role played by the United Kingdom in securing that outcome have been widely welcomed.

Dr. Strang: Is the Secretary of State aware that many scientists take the view that the United Nations convention on climate change and the United Kingdom and European Community commitments to reduce carbon dioxide emissions to 1990 levels by the year 2000 are insufficient to prevent serious global warming? Does the Secretary of State agree with those scientists? If so, will the Government use their presidency of the EC to secure tighter commitments in that area?

Mr. Howard: I have no doubt that some scientists take the view expressed by the hon. Gentleman. He is right to identify the considerable scientific uncertainty that exists in that regard. That is why we place great emphasis on the importance of keeping our commitments under review. They will, indeed, be reviewed and if there is greater scientific unanimity either way, or greater technological information that we can take into account, we shall not hesitate to amend and revise them in the light of that review.

Mr. Bayley: I welcomed the announcement made by the Prime Minister before he went to Rio that he would recycle empty bottles from Downing street by taking them to a bottle bank. Doubtless that will make a significant contribution to the energy-saving commitments given by the Government in Rio. But will the Secretary of State reverse his advice to local authorities that he will give no more supplementary credit approvals for kerbside collections so that local authorities can do the same as the Prime Minister and encourage more people to save glass?

Mr. Howard: If the hon. Gentleman examines the details, he will find that local authorities have adequate resources to fulfil their environmental obligations, and the best local authorities are discharging those obligations very effectively.

Mr. David Nicholson: The attitude of the United States Administration to the Rio conference is to be regretted, but will my right hon. and learned Friend say whether the United Kingdom Government played a part in bringing the United States Administration forward in that respect? In particular, what developments took place at Rio with regard to safeguarding tropical rain forests?

Mr. Howard: We certainly played a part in reaching a position that enabled the United States to sign the climate change convention. As the United States is responsible for 25 per cent. of the world's carbon dioxide emissions, it was essential that it signed up to that treaty. The United States took a different view about the biodiversity treaty, but it has agreed to take part in the processes under that treaty. Nevertheless, I hope that it will be possible for the United States to sign up to that convention in due course. After very protracted negotiations we were able to reach an agreement on forests—not a convention as we had hoped, but an agreement that holds open the possibility of moving towards a convention. We shall vigorously pursue the possibilities of reviewing the agreement in that way.

Mr. Harry Greenway: I remind my right hon. and learned Friend that Zaire has two thirds of the world's tropical rain forests. How will any arrangements secure the future of those forests, bearing in mind the pressure on that poor country to use its resources to improve its position and that of its people?

Mr. Howard: I shall send my hon. Friend a copy of the agreement, which sets out in full provisions that will enable progress to be made in Zaire and in other countries and encourage countries to engage in the proper management of their forests, while recognising that it would be foolish to suggest that not a single tree should be cut down and that such countries will not wish to make use of those resources. It is important that we develop a way in which sustainable use can be made of those resources, and that is the objective of the forestry agreement.

Mr. Simon Hughes: Whatever reservations there may be about the Rio summit, may I congratulate the Secretary of State and his team on the signing of the two conventions on biodiversity and climate change? In order to keep up the momentum, will he give an assurance that, during Britain's European presidency—which falls to us from 1 July—we will immediately set about negotiation of the protocols to the conventions and take the lead in ensuring that they are both ratified quickly, and will now sign a like-minded countries' declaration on climate change?

Mr. Howard: I am grateful to the hon. Gentleman for his remarks. I can go one better than he suggests. In his statement to the House on Monday, my right hon. Friend the Prime Minister said that he would write to the other countries in the European Community and to the other G7 countries proposing a follow-up to the conventions that were signed at Rio. The hon. Gentleman can be assured that my right hon. Friend the Prime Minister and the Government in general will continue to take a lead in these matters.

Mrs. Ann Taylor: Will the Secretary of State say clearly what the Prime Minister failed to say on Monday—that the Government will accept the target of stabilising carbon dioxide emissions at 1990 levels by the year 2000 as a clear commitment with no strings attached? Will he acknowledge that if the Government had accepted that target—for which we have been arguing for many years—earlier, more progress could have been made in combating global warming and indeed in strengthening the hand of the British Government in their negotiations?

Mr. Howard: No. I entirely reject the hon. Lady's suggestion. I do not think that there is any foundation for it at all. When we revised our commitment just a few weeks ago and committed ourselves to bringing down emissions to 1990 levels by the year 2000, we made it clear that we would do that if other countries took similar action. It is important to appreciate that this is a global problem which requires a global response. It is as important to secure multilateral, rather then unilateral, action in this matter as it was in respect of disarmament, when the stand taken by Her Majesty's Government proved to be effective, in contrast to the stand urged upon us by the Opposition.

Rural Housing

Mr. Ancram: To ask the Secretary of State for the Environment what further measures he proposes to introduce to stimulate the provision of affordable housing for local people in rural areas.

The Minister for Housing and Planning (Sir George Young): We have taken a series of measures since 1988 to boost supply of low-cost housing in rural areas to enable local people to stay in the areas where they have grown up. We have substantially increased public resources, through the Housing Corporation, for new investment by housing associations. In addition, the Housing Corporation and local authority special rural programmes should together provide around 3,400 units this year. New planning guidance permits development of low-cost housing for local needs on small sites not otherwise designated for housing.

Mr. Ancram: I welcome the current initiatives, but does my hon. Friend accept that the continuing lack of affordable housing in a constituency such as mine severely restricts the choice in housing that the Government are seeking to promote? Will he look for new ways of bringing together the public and private sectors, including housing associations, housing trusts, building societies and local councils, to promote joint schemes that can provide local housing for local people at rents and prices that local people can afford?

Sir George Young: I recognise the pressures in my hon. Friend's constituency. He brings to the problems his

experience as a former Housing Minister in Scotland, where he pioneered a number of innovative housing measures. On the subject of his own constituency, he will know that, last year, we were able to approve two schemes at Sillington lane, Poushot and at Nether street in Bromham and, this year, an additional scheme at East Grafton. My hon. Friend is right. If real progress is to be made, the co-operation of landowners, housing associations, planners and housing committees, as well as the private sector, will be needed. I am determined to make further progress in that direction.

Mr. Canavan: Does the Minister agree that housing provision in rural areas might be improved if absentee landlords such as the Marquess of Lothian and the Earl of Ancram let out some of their huge country mansions to homeless people?

Sir George Young: My responsibilities stop at the border. The Scottish dimension of politics continues to fox me, so I shall not enter into any local Scottish debates in the Chamber this afternoon.

Sir Anthony Grant: Does my hon. Friend recall that just before the last general election the Secretary of State for the Environment issued a sensible guidance circular to authorities which pointed out that where large settlements or village developments were to take place it was essential to take into consideration the wishes of the people in the locality? Can he confirm that under the new regime that will be rigorously applied?

Sir George Young: My hon. Friend refers to planning policy guidance note No. 3, which was issued shortly before the election. It indeed states the Government's policy on new settlements and villages. I reaffirm that where a local authority proposes such developments it must take account of local opinion and ensure that any proposal is with the grain rather than against it.

Mr. Soley: Is not it a matter of some shame that, 13 years after the Government embarked on their absurd housing policy, Government-appointed bodies as well as Conservative local authorities in rural areas condemn them for failing to meet the need for affordable housing? Is not it a fact that in Devizes, the constituency of the hon. Gentleman who asked the question, many Government-owned houses have been lying empty for many years? Why does not the Minister transfer those houses to local authorities and housing associations? Why does he not recognise the Government's failure to deliver affordable properties for rent or purchase, especially in the rural villages of England and around London where there is the problem of the commuter belt? Why does he not use resources, especially from capital receipts from the sale of council houses, which are still unused?

Sir George Young: I do not accept the analysis to which we have just listened. There are 2 million more homes than there were in 1979. There are more homes per 1,000 population than in 1979. The Housing Corporation programme is increasing dramatically. Its output this year is some 54,000 homes—about three times the level of two or three years ago.
The hon. Gentleman will know that there are fresh initiatives on empty MOD stock, including those in the Conservative party manifesto. We are determined to put to good use any surplus stock that the MOD has. However,


the MOD is bringing back a substantial number of troops from Germany and other places. Much of the accommodation that is now empty may be needed for those families.

Contracting-out

Mrs. Gorman: To ask the Secretary of State for the Environment if he has any plans to review the prospects for contracting out the functions of his Department.

The Parliamentary Under-Secretary of State for the Environment (Mr. Tony Baldry): Yes. The Department undertook a full examination in 1990 of the prospects for market-testing functions, leading to possible contracting-out. Those prospects have been reviewed by officials, with private-sector assistance, in developing a programme for market-testing in response to the "Competing For Quality" White Paper, and will be continually reassessed.

Mrs. Gorman: I thank my hon. Friend for his answer. Does he agree that it would be a great feather in the cap of the Secretary of State for the Environment if, instead of looking for new premises elsewhere in London or anywhere else, he set about winding up the whole of his Department? That would be a wonderful example to Whitehall. As housing is now well on the way to returning to the private sector, as the new town corporation is already being wound up, water is already in private hands, and as the countryside would be better looked after by the National Trust or the Country Gentlemen's Association, there is little excuse for carting the enormous Department of the Environment all the way down the river to Canary Wharf.

Mr. Baldry: I know that we are having a particularly tough public spending round this year, but I cannot believe that the Treasury is suborning the likes of my hon. Friend to propose the wholesale closure of Departments. So I can only presume that her question was a freelance bid for a couple of lines in the Matthew Parris column.

Mr. Hardy: The Minister must understand that his hon. Friend has a serious point. Agencies have proliferated, work has been shed and ministerial workloads reduced —at what point will Ministers share the experience of redundancy, which is affecting the rest of the country?

Mr. Baldry: The hon. Gentleman might not have noticed that the Department has one Minister fewer than it did before the general election, dealing with the same effective workload.

Compulsory Competitive Tendering

Mrs. Angela Knight: To ask the Secretary of State for the Environment whether he has any proposals to extend compulsory competitive tendering for local authority services.

The Minister for Local Government and Inner Cities (Mr. John Redwood): The Government have recently announced proposals for tendering housing management functions and we are considering the responses to the consultation paper "Competing for Quality: Competition in the Provision of Local Services". My only sadness is that I do not have the pleasure of responding to what I suspect was an attempt by my hon. Friend the Member for Billericay (Mrs. Gorman) to wind me up.

Mrs. Angela Knight: Whereas competitive tendering is bringing its successes, will my hon. Friend consider reviewing the non-competitive practices still employed by some Labour-controlled local authorities, who are seeking to preserve themselves in overstaffed departments, rather than getting on with the job of repairing roads, mending schools and cleaning the streets effectively and efficiently, which is what local residents want?

Mr. Redwood: I am grateful to my hon. Friend. We shall consult about the fairness of the terms of the local authority tendering process because we are determined that tendering should be properly conducted in the interests of the charge payer and the council tax payer next year. We wish to encourage high-quality services, properly managed, delivered at an economic price and that is the purpose of having a level playing field. As I said originally, we shall also consider extensions where we think that that makes sense.

Mr. William O'Brien: Does the Minister still hold the view that compulsory competitive tendering guarantees quality of service and, if so, how does he justify it? Will he ensure that all future contracting documents under the compulsory competitive tendering system include a quality of service paragraph? Will that apply to contracts for refuse collection, catering, school cleaning, recreation facilities and so on?

Mr. Redwood: It is good practice to include quality clauses. I am pleased that independent research has not shown any deterioration in quality as a result of competitive tendering—[HON. MEMBERS: "What?"] Yes, the evidence is there. When properly conducted it could improve quality, because it gives people management control over quality and a right of redress if things go wrong. We want quality services at a sensible price, which is what competitive tendering can deliver.

Housing, South-West

Mr. Steen: To ask the Secretary of State for the Environment what estimate he has made of the amount of additional housing that will be required in (a) Devon and (b) the south-west by the year 2010.

Mr. Baldry: None at the present. We expect to publish, next year, regional planning guidance which will set out the broad scale and distribution of housing provision to be made in development plans in the south-west for a 15-year period.

Mr. Steen: The Earth summit highlighted the problem of over-population and its effect on the environment, and that problem exists in Devon, where the population has increased more and more, not because of an absence of family planning, but simply because successive structure plans have allowed too much housing there. Will the Minister confirm that, in the new Devon structure plan, which is under review, he will not impose more houses on the area just because his officials want him to do so but will do what the local district councils want? Will he also ensure that, if there are any new housing developments, it is the infrastructure that counts and that too many houses are not built, disregarding—

Madam Speaker: Order. The hon. Gentleman must ask his question and not make statements.

Mr. Baldry: Housing provision for Devon from 1989 to 2001 was discussed, as my hon. Friend knows, at an examination in public held earlier this year. I shall carefully consider the report of the panel conducting the examination in public and all representations and objections, including my hon. Friend's, before making a decision on the amount of housing provision for Devon until 2001.

Residential Staff

Mrs. Bridget Prentice: To ask the Secretary of State for the Environment whether he will take account of the costs of implementing the recommendations of the Howe inquiry into residential staff in relation to pay, training and development, in the revenue support grant settlement for local authorities in 1993–94.

The Parliamentary Under-Secretary of State for the Environment (Mr. Robin Squire): The cost of those new burdens, which the Government accept local authorities necessarily face, including any costs that may arise from the recommendations of the Howe inquiry, will be taken into account when decisions are taken on the revenue support grant settlement for 1993–94.

Mrs. Prentice: I should like to be able to welcome that statement, but, unfortunately, the Minister was unable to say whether those resources will be fully met. Does he agree with me and most other people who are concerned about residential care—whether of children, the mentally disabled or the elderly—that those residents must be looked after with the highest quality of care and that that can be given only by highly motivated and properly trained professionals? Does he not also recognise that it is time that the Government put their money where their mouth is and instead of just talking about community care, gave local councils the cash to provide it?

Mr. Squire: I note what the hon. Lady says. She is probably aware that such detailed matters are the responsibility of my right hon. Friend the Secretary of State for Health. However, I can tell her that the settlement will reflect both the need for local authority spending and, importantly, what council tax payers and the country as a whole can afford.

Mr. Blunkett: Will the Under-Secretary tell us why the provisional grant settlement has been deferred from July until the autumn? When will the community as a whole be told how much it will receive in grants and allocations from the Department of Social Security so that it can plan ahead? That information is necessary to make community care a reality and to allow authorities to do the essential job of putting the ground work in place and so ensure that the most vulnerable in society do not suffer because of the row between his Department, the Department of Social Security and the Treasury about how much money should be made available.

Mr. Squire: I am surprised at the hon. Gentleman's comments. He knows that it is in the general interests of local government and central Government that next year services, not least the provision of care in the community to which reference has been made, and the introduction of the new tax should go through as smoothly as possible.

The Government are determined that that will be so and that is why we have announced that the decision will be made in the autumn.

Water Legislation

Dr. Liam Fox: To ask the Secretary of State for the Environment what plans he has to introduce provisions revising the legislation governing the water industry.

The Minister for the Environment and Countryside (Mr. David Maclean): The enhanced powers of the Director General of Water Services to monitor performance by water companies and to foster competition, will be brought into effect on 1 July. New powers for the director general to decide various types of dispute between customers and companies will be brought into effect on 1 September.

Dr. Fox: The Minister's response will be extremely welcome in my constituency of Woodspring and throughout Bristol. Is my hon. Friend aware that the proportion of the water industry's profits that now goes to shareholders is lower than the amount of interest that was returned to the Government when the industry was in public hands? The privatisation of water has been vindicated on the ground not only of environmental stewardship, but of pure economics.

Mr. Maclean: My hon. Friend is absolutely right. Moreover, as we said in yesterday's debate, the water companies are investing twice as much in the infrastructure as they have made in profits. That is a pretty good record, which is not matched by many other companies in this country.

Mr. Win Griffiths: Does the Minister admit that it is a great pity that the Government did not take the opportunity presented by the recent legislation, which introduces the powers to which he referred, to prevent water companies from introducing compulsory metering? In virtually all cases where meters are installed, those customers, who have no choice about metering, have found that their bills have shot up well above those that are based on the rateable value of customers' houses. If he admits that mistake, we will give him every assistance in passing a quick Bill to prevent compulsory water metering.

Mr. Maclean: The hon. Gentleman misses the point, as did his hon. Friends yesterday. The fact is that the water companies are providing a service to the public that has to be paid for somehow. We have three powerful watchdogs—the National Rivers Authority, the Director General of Water Services and the drinking water inspectorate—which act as regulators to the industry. As we have set up those regulators, it is best to let them get on with their job and not, as politicians, try to interfere with their decisions.

Mr. Rupert Allason: Is my hon. Friend aware of the grave anxiety in the south-west about the water bills that have been sent out by South West Water? Has he any proposals, following the controlled experiment on the Isle of Wight, to recommend or introduce widespread water metering, at least to make certain that high consumers of water pay for the service? The burden should not be transferred to single pensioners living alone who are receiving excessive bills based on water rates.

Mr. Maclean: There has had to be tremendous investment in the infrastructure in the south-west to comply with EC directives and improve the quality of bathing waters around the coast. That has cost a considerable amount, which has had to be paid for by consumers in the area. However, we intend shortly to issue a consultation paper on all aspects of water conservation and how it may be used, distributed and stored. Obviously, water metering will be one of the options canvassed in that consultation paper.

Toxic Emissions, Merseyside

Mr. Loyden: To ask the Secretary of State for the Environment what steps are being taken to reduce the risks of toxic emissions and spillages at Shell and ICI plants at Merseyside.

Mr. Maclean: When part I of the Environmental Protection Act 1990 is fully implemented, all the plant operated by Shell and ICI on Merseyside will have to comply with the requirements of the Act, and this will represent a significant improvement in the regulatory control of all emissions.

Mr. Loyden: The Minister will be aware of the appalling record of both those companies in relation to pollution through spillages and emissions. One of the companies has been fined six times and the other five times. Whatever the Government feel about the regulatory bodies, it appears that they are having no effect on those companies' disregard for pollution in that area. Is the Minister aware that there are many dangerous practices in some of their plants, about which the community is very concerned? As I have requested previously, will he make the reports of the Health and Safety Executive available in the Library so that we can see what its findings were?

Mr. Maclean: There have been some incidents at the Shell and ICI plants at Runcorn, but, in all fairness, the hon. Gentleman should point out the huge size of the plants and the complicated processes that take place there. The new regulatory regime which has come into force in this country, which is operated by Her Majesty's inspectorate of pollution—integrated pollution control—is revolutionary. It is the first of its kind in Europe and the HMIP is looking into all aspects of the processes operated on Merseyside. They will all come under integrated pollution control. The hon. Gentleman will see that, in time, it will have considerable benefits for all people on Merseyside.

Water Companies (Investment)

Mr. Robert B. Jones: To ask the Secretary of State for the Environment what account the Office of Water Services takes in its regulation activities of the amount of investment by water companies.

Mr. Maclean: As the water industry is engaged in a massive capital investment programme estimated to cost £28 billion, the Director General of Water Services, as the independent regulator, has a close interest in ensuring that the investment is carried out on time and in an efficient way.

Mr. Jones: I thank my hon. Friend for that answer. Once again, it underlines the sheer volume of that

investment, which amounts to some £960 per household in the years up to 1996. Does he not think, however, that as most of that investment is directed at water quality, it would be appropriate for the Director General of Water Services to consider whether more should be directed at water efficiency and, specifically, at encouraging investment in metering on a voluntary basis in many parts of the country?

Mr. Maclean: My hon. Friend is right to draw attention to the huge investment being made in the water industry at present. As a rough rule of thumb, it is £5,000 for every minute. My prime concern is that water companies should maintain adequate supplies to consumers while properly managing water resources efficiently and not damaging the environment. All of us could do more to conserve water, and that is why I shall shortly issue the consultation paper, which will canvass views on water conservation, management and use. Metering will be one of the options considered.

Mr. Wigley: Will the Minister address the issue of compound interest involved in the formula, RPI plus K, in which over and above inflation there is an increase of up to 6.5 per cent. per annum of compound interest in the charge made? Surely that should be levelled out and, although there may be justification for retaining the RPI element, surely K must be brought to an end.

Mr. Maclean: That is a matter for Ian Byatt, the director general of Ofwat. He has recently issued a consultation paper, and he will consider the matter raised by the hon. Gentleman when undertaking a review of K in the next few years.

Sir Nicholas Bonsor: My hon. Friend will be aware that, notwithstanding the enormous investment in water supply, there will be a great shortage of water for the foreseeable future in some parts of the country. Does my hon. Friend accept that there is an urgent need for a national water grid as, I am told, the national water supply is perfectly adequate for our overall needs?

Mr. Maclean: The water companies have a prime duty to ensure that consumers are supplied with adequate amounts of healthy, wholesome water. In the past few years, those companies have developed river transfer schemes and the elements of a grid. However, I caution my hon. Friend when he suggests that we should have a national grid pumping thousands of millions of gallons of water around the country. We should be wary of doing that on the basis of the huge amount of energy that it would consume. My hon. Friend should not jump to the conclusion that all parts of the country have more than adequate water supplies. One of the rivers that is under threat and is very low is in the lake district; it supplies Lake Ullswater, which supplies Haweswater, which supplies Manchester.

Rented Housing

Mr. Pike: To ask the Secretary of State for the Environment whether he proposes to make additional financial resources available for the provision of affordable housing to rent.

Sir George Young: We are taking steps to increase supply of low-cost rented housing where it is needed. The


Housing Corporation's capital programme for new development by housing associations will rise to more than £2 billion by 1993–94 from £1 billion for 1990–91. Together with associations' use of private investment on a growing scale, that will increase their output financed through the Housing Corporation to more than 51,000 units a year by 1993–94 from 16,900 units in 1990–91. Deregulation of the private rented sector in 1989 has also led to a welcome increase in private letting.

Mr. Pike: Does the Minister accept that, despite what he says, there is a major shortage of affordable housing for rent and a number of housing problems? Will he tell his Treasury colleagues that now is the time to allow local authorities to use their capital receipts to build houses to rent, which would help to solve some of the housing problems, help the industry and also help to start the economy?

Sir George Young: I am sure that the hon. Gentleman understands that if one were to allow local authorities to spend their own capital receipts, that would directly reduce the amount of money that my Department could lend to other authorities—[HON. MEMBERS: "Why?"] Otherwise, the net total of public expenditure would increase. If the hon. Gentleman wants to make an argument for increasing public expenditure on housing, he can do so. But simply allowing local authorities to spend their own capital receipts would reduce the funds available to local authorities on the basis of need. We can make much better progress with the resources that we have. There are 80,000 empty local authority homes; 100,000 flats over shops that we are progressively bringing back into use; and we have fresh initiatives to bring back into use 600,000 empty properties in the private sector. As the Audit Commission recently said, we can do far more to help to meet people's housing needs by making better use of the available resources.

Mr. James Hill: Does my hon. Friend agree that it is not just a matter of financial resources? Many local authorities squirrel away large areas of land and wait for money to become available. They will not put them to auction and will not allow anyone else to build low-cost housing for rent. In addition, some local authorities firmly resist allowing the private sector or housing associations entry into the rented market. What can we do to make them release land?

Sir George Young: My hon. Friend is right. If he looks at the Audit Commission report published recently, he will see that one recommendation is, indeed, that local authorities should make land available to housing associations. It is inexcusable that local authorities that own land zoned for residential accommodation should sit on it when housing associations can develop it and give the local authority the necessary nominations.

Mr. Betts: Will the Minister admit that the Government's rules on the use of capital receipts by local authorities are nonsense? Is he not aware of the thousands of young people who are homeless, many of whom sleep on the streets of our native cities? Is he not aware of the tens of thousands of young people who are living at home with their parents waiting for a home that does not exist? Is the message to them from his Government that the Government have no heart and offer them no hope?

Sir George Young: I outlined in my initial reply the increased resources that are being made available to the Housing Corporation precisely to meet the needs that the hon. Gentleman has identified. If the Labour party wants us to return to the old regime of capital receipts, that would severely damage authorities in the inner cities that benefit from the new regime. Under the old regime, the receipts tended to accrue in areas that did not have the greatest housing need. Those areas with greatest need did not have the right-to-buy receipts. The advantage of the new regime is that it recycles those receipts on the basis of need. I should be astounded if the Labour party wanted to overturn that policy.

Mrs. Peacock: I welcome my hon. Friend's announcement of increased funding for the Housing Corporation for 1992–93. Will he assure the House that he will take steps so that the north of England receives an equal share of that money and it is not all spent in the south?

Sir George Young: I understand my hon. Friend's point. Recently I met a delegation from the regional equity group and we listened to representations. Because of the increased resources available to the Housing Corporation, all regions are benefiting from an increased allocation.

Charge Capping, Cheltenham

Mr. Nigel Jones: To ask the Secretary of State for the Environment what representations he has received concerning the proposed community charge capping of Cheltenham borough council.

Mr. Robin Squire: Cheltenham has issued a formal challenge to the cap that my right hon. and learned Friend proposed for it on 14 May. It has proposed an alternative cap, set at the level of its original budget.

Mr. Jones: I urge the Minister to look closely at the document that Cheltenham council produced. Will he explain to the House how charge capping increases local accountability when it takes away from elected councillors the ability to put into practice the programme on which they were elected and denies the people the high-quality, well-managed services for which they voted?

Mr. Squire: My colleagues and I will certainly think seriously about all the representations made to us by Cheltenham and other authorities before we come to our conclusions. The hon. Gentleman's wider point must be seen against the background of an overwhelming proportion of local authorities that brought in budgets at or below their ceilings. I congratulate them on that. The Government, unlike the Opposition, believe that we have a responsibility to protect charge payers from high-spending authorities and we continue to carry out that responsibility.

Estate Action

Mr. Simon Coombs: To ask the Secretary of State for the Environment if he will make a statement on the estate action programme.

Sir George Young: The estate action programme now makes a major contribution to tackling the problems of run-down local authority estates. Resources have


increased from £268 million last year to £364 million this year, and I shall shortly be inviting local authorities to submit proposals for new schemes to begin in 1993–94.

Mr. Coombs: Will my hon. Friend accept the congratulations of the House on a scheme that has contrived to spend £640 million in the seven years since it was first introduced on 700 schemes spread over 140 local authority areas, and of which he could lay claim to be the progenitor? Will he look at the publicity for the scheme to ensure that it is brought to the attention of other newer local authorities that may have lesser problems than those of the recipients of money so far? At the same time. will he look at the criteria by which schemes are judged, so that those authorities may also lay claim to some of the resources that he plans to make available?

Sir George Young: I am grateful to my hon. Friend. It is indeed the case that more than 250,000 homes have been improved under estate action, which has helped to transform the lives of people living on some of our most difficult estates. As I said, I shall shortly be inviting local authorities to bid for the schemes for next year, and I will ensure that information about the estate action programme is widely disseminated.
If there are proposals to change the rules to make better use of the money, I shall be happy to discuss them with local authorities.

Mr. George Howarth: I welcome the continued development of the estate action programme, but since, as the Minister will be aware, a large part of that programme involves tenant participation, how far has his Department's consideration of tenant participation strategy got and when will the report be published? Clearly, one has a bearing on the other.

Sir George Young: We have made some investment in organisations such as the tenant participation advisory service. The proposals that we published last week on competitive tendering for housing management gave tenants for the first time the right to manage, rather than relying on the discretion of a local authority. We are determined to harness tenants associations' energy and enthusiasm as we develop our housing policy. We are keen to see more estate management boards, tenant management organisations and co-operatives taking over responsibility for their estates. That is a theme about which we shall hear a lot during the next four or five years.

Local Government Review

Mr. Moss: To ask the Secretary of State for the Environment whether he will ensure that full weight is given to local opinion in the forthcoming review of the structure of local government.

Mr. Redwood: Yes. That is most important. Local opinion will be crucial in the local government commission's work programme. I have asked the commission to ensure that there are good arrangements for Members of Parliament to be able to make representations to it on those crucial matters.

Mr. Moss: Will my hon. Friend confirm that a priority of the local government review is to preserve community identity? In the interests of testing real local opinion, does he agree that in rural areas such as Cambridgeshire it

would make sense to start at grass roots, at local parish council level, and work upwards, rather than have something imposed from the county council downwards?

Mr. Redwood: It was clear in the legislation passed last Session that the definition of natural communities was an important task of the commission. That is one of the two guiding principles in making recommendations on a new structure. Parish councils should be prepared to have discussions with county and district councils, which will undoubtedly put proposals to the commission to see how the powers under existing legislation can best be used to ensure that strong parish councils wishing to undertake a role in the new structure can do so.

Mr. Barnes: Why does the local government boundary commissioner have to consult the Parliamentary Commissioner for Administration when drawing up proposals? Is not that wide open to abuse? For example, Derbyshire is in the first tranche to be investigated under local government, but it is likely to be at the back end when it comes to parliamentary seats. That means that, because of the link between the two, the parliamentary seats will shape the local government provision, rather than the usual practice of local government shaping parliamentary seats.

Mr. Redwood: I do not agree with all the implications behind the hon. Gentleman's question. The purpose of the local government review is to find suitable boundaries and proposals for councils and there can be interaction only if county boundaries are to be changed. All the relevant considerations will be taken into account by the new commission as it goes about its work.

Mr. Pickles: Does my hon. Friend recognise that there is much local concern about reorganisation and that the principal concern is that there should not simply be a replication of existing councils, with either a small county council or a large, super-district council? Will the Government ensure that the review's function is such that we have an enabling council and that a new civic pride is engendered not only in the ownership of services but in the quality of services?

Mr. Redwood: A sense of belonging and of happiness with the proposals in the local community is important, as I have already said in answer to previous questions. The style and method of operating particular councils will be reviewed by the commission in the light of proposals from the councils in the area and in the light of its thoughts about any other options that should be considered. My hon. Friend will have a full chance to influence the commission, as will other hon. Members, when it reaches their areas.

Eco-labelling

Mr. Bennett: To ask the Secretary of State for the Environment if he will make a statement about the introduction of eco-labels—green labels.

Mr. Maclean: The United Kingdom has strongly supported the development of the European eco-labelling scheme, so I am delighted that the EC regulation is now in place and that arrangements are progressing for launching


the scheme towards the end of the year. We shall continue to press the Commission and the other member states to ensure that this timetable is met.

Mr. Bennett: Will the Minister confirm his green credentials by telling us which washing-up liquid he uses? Will he also confirm that some of the other EC states are still dragging their feet in regard to eco-labelling, and that it would have been far better for this country to go ahead on its own?

Mr. Maclean: I shall come clean in a moment.
The hon. Gentleman fails to grasp the point that if we are to make any real environmental progress, we must do so in concert with other nations. We have a free trading area in Europe, where goods and products are moved around the Community. Without a Europewide ecolabelling scheme—which is now within our grasp—that arrangement would not be as effective as it should be.
In answer to the hon. Gentleman's first question, I believe in being a liberated husband and sharing the household duties; unfortunately, however, washing up is not the duty that has been allocated to me.

Earth Summit

Rev. Martin Smyth: To ask the Secretary of State for the Environment if he will make a statement on the fiscal and industrial consequences for the United Kingdom of decisions reached at the Rio de Janeiro conference.

Mr. Howard: The impetus for sustainable development resulting from the Earth summit will have significant consequences in many areas of our national life. The Government are committed to reporting regularly on the progress that we make in following up the summit's conclusions.

Rev. Martin Smyth: In the light of that answer, and the attitude of, for example, the United States Government, does the Secretary of State accept that short-term gain might mean long-term ruin—not only for developed countries but, especially, for developing countries?

Mr. Howard: The hon. Gentleman is right. That lies at the heart of the whole concept of sustainable development, and I welcome his support for the steps that we have taken.

Sir Anthony Durant: Does my right hon. and learned Friend agree that any proposed carbon tax ought to be introduced world wide, rather than imposed on countries such as ours in isolation?

Mr. Howard: I am sure that my hon. Friend, who takes a close interest in such matters, will be much comforted to learn that the European Commission's proposals for a carbon tax include an element of conditionality. His concern is reflected in them.

Standard Spending Assessments

Mr. Austin Mitchell: To ask the Secretary of State for the Environment what plans he has to revise standard spending assessments to make them a realistic reflection of local needs.

Mr. Ian Bruce: To ask the Secretary of State for the Environment if he will make a statement on the planned changes to the standard spending assessment calculation for 1993–94.

Mr. Robin Squire: Standard spending assessments are a realistic reflection of local needs. Discussions with the local authority associations about a few possible changes for 1993–94 began in February. Data from the 1991 census will be incorporated into the assessments as soon as possible, but for most items this will probably be for 1994–95.

Mr. Mitchell: The Minister would need the wisdom of Solomon to devise a national system of assessment that fitted all the circumstances even approximately. Does he concede, however, that the SSAs do a particular injustice to such places as Grimsby? First, they make no allowance for unemployment; secondly, they do make allowance for ethnic communities, which do not exist in Grimsby; thirdly, they make allowance for visiting nights, but unfortunately not many tourists come to Grimsby; and, fourthly, the method of assessing debt repayment has been a particular source of grievance. The difference between the Department's calculation and the sum that Grimsby is actually repaying amounts to £30 to £40 per head on the poll tax. Does not all that make a case for a much more realistic SSA?

Mr. Squire: I am unsurprised by the hon. Gentleman's comments. I pay tribute to him: he asks a good many questions about this subject, and he has asked a good many on this occasion. Let me concentrate on two of them.
The hon. Gentleman mentioned unemployment. As he knows, we judge that unemployment is not a relevant factor in the assessment relating to district-level services. He also raised the question of notional debt. The use of notional debt ensures that all authorities are treated fairly; if we acted otherwise, we would disadvantage authorities that had previously chosen to use capital receipts to repay their debts.

Mr. Bruce: The county of Dorset is excellent at keeping within its spending limits, and it is a debt-free county. It is often felt that, when the Government set the SSA, Dorset is treated unfairly simply because it is a good Tory authority. The community care budget in particular will have to be increased considerably in all counties—especially in counties such as Dorset, which contain large numbers of elderly people. Will my hon. Friend ensure that the new SSA for Dorset will be generous, and that an early indication is given of when it will apply?

Mr. Squire: I am grateful to my hon. Friend. I sympathise with some of his points. He will have heard my earlier answer on community care: the Government will not make an announcement until the autumn. However, to repeat something that I said a few moments ago, standard spending assessments are calculated according to general principles and are applied in the same way to all authorities. One of the reasons why my hon. Friend's local authority will receive a relatively lower SSA is that, by most measurements of need, it does not have the same degree of need as other areas with higher SSAs.

County Hall, London

Mr. Tony Banks: To ask the Secretary of State for the Environment if he will make a statement about the future of county hall, London.

Mr. Redwood: Responsibility for the disposal of county hall rests with the London residuary body. It has entered into an agreement with the Japanese company Shirayama


for the sale of the riverside building. An alternative proposal has been received from the London School of Economics. It is the intention that a statement should be made on this proposal in the near future, when it has been fully evaluated.

Mr. Banks: I am part grateful to the Minister for his reply. May I draw his attention to the all-party early-day motion 259, and ask him whether he is prepared to see an all-party delegation in his office before any further consideration is given to the issue? We should be grateful for that. Is it not a great shame that one of the premier, internationally known academic institutions in this country will possibly be denied access to the building, all parts of which it would use—not just the riverside—whereas a cheapjack, Japanese hotel group would use just the riverside front for a luxury hotel? It is a disgrace.

Mr. Redwood: The Government are well aware of the strong views on this subject on both sides of the argument and will take them fully into account when coming to their conclusion.

Mr. Jessel: Will my hon. Friend make sure that county hall is sold for as large a sum as possible, in order to benefit the people in all 32 London boroughs? Will he make certain that it is so well scrambled into private use that never again can it be commandeered as an autocratic socialist regional bureaucracy?

Mr. Redwood: My hon. Friend has made his point very forcefully. He has shown that there are divided views in the House on this important issue.

Rented Housing

Mr. Betts: To ask the Secretary of State for the Environment what proposals he has to deal with the findings of the Audit Commission in its recent report on rented housing.

Sir George Young: The Audit Commission's report "Developing Local Authority Housing Strategies" commented helpfully on national housing policy issues and recommended ways in which local authorities could improve their performance. My announcement to the House on 21 May of proposals to place further emphasis on local authorities' efficiency and effectiveness in allocating housing investment resources, having regard to their developing enabling role as well as their role as direct housing providers, will help us to get best value for money from the full range of resources for special housing going into each area, as recommended by the commission.

Mr. Betts: Is it not true that the Audit Commission report also said that Government policies were totally inadequate to provide a proper supply of rented housing? Is it not also true that the National Federation of Housing Associations has produced a report which admits that some Government initiatives have produced some extra houses, but which also says that, as the Government insist on a very high level of private capital being included in the provisions, people on low incomes cannot afford those houses because rents have been forced up to such a high level by the Government's policy?

Sir George Young: The Audit Commission report focuses mainly on local authorities. Its title is "Developing Local Authority Housing Strategies". It lists a range of measures that local authorities should take to make progress, such as letting their properties faster, evicting squatters and other illegal tenants, giving land to housing associations and bringing in other agencies, particularly housing associations, to help to solve local problems. It made estimates of the national need, ranging from 58,000 to 90,000. I am prepared to meet the Audit Commission and talk through some of the implications of its report which are addressed to central Government.

Mr. Colvin: Does my hon. Friend agree that one way to help the public housing sector is to stimulate the private rented sector? Although I welcome everything that the Government have done to that end, I agree with the hon. Member for Sheffield, Attercliffe (Mr. Betts) that very often rents in the private sector are far too high. One way to bring them down and to make them more affordable would be to introduce a housing tax allowance of about the same value as mortgage interest tax relief. When I suggested that to a Treasury Minister earlier this week, it was not ruled out of court. Will my hon. Friend join this lobby to try to persuade the Treasury to consider such a tax allowance which, I am sure, would do a great deal to make private rented accommodation more affordable?

Sir George Young: I am interested to hear of the exchange between my hon. Friend and my ministerial colleagues in the Treasury. As he rightly says, the question of tax allowances falls to the Treasury rather than to my Department, but we are anxious to get the private rented sector back on its feet. Last year, for the first time in many decades, there were more lettings in the private rented sector than leases falling in, so there are signs that the private rented sector has bottomed out. I am prepared to consider what further measures should be introduced to encourage more people to invest in good-quality accommodation for rent.

BALLOT FOR NOTICES OF MOTIONS FOR FRIDAY 3 JULY

Several Hon. Members: rose—

Madam Speaker: Order. The Ballot Book has been open since 2.15 pm. There can be no more signatures. [Interruption.] From 2.15 to 3.30 is quite a long time.

Members successful in the ballot were:

Mrs. Anne Campbell
Mr. Jim Marshall
Dr. John Marek

BILLS PRESENTED

COMMONWEALTH OF EUROPE

Mr. Tony Benn presented a Bill to provide for the establishment of a Commonwealth of Europe, and for purposes connected therewith: And the same was read the First time; and ordered to be read a Second time on Friday 11 December and to be printed. [Bill 33.]

MISUSE OF DRUGS (ANABOLIC STEROIDS)

Mr. Menzies Campbell presented a Bill to extend the coverage of the Misuse of Drugs Act 1971 to include certain drugs which have been misused for the purpose of improving performance in sport: And the same was read the First time; and ordered to be read a Second time on Friday 3 July and to be printed. [Bill 41.]

Orders of the Day — Bankruptcy (Scotland) Bill

Order for Second Reading read.

Madam Speaker: I have selected the amendment in the name of the hon. Member for Glasgow, Garscadden (Mr. Dewar).

The Secretary of State for Scotland (Mr. Ian Lang): I beg to move, That the Bill be now read a Second time.
Today's debate may carry with it an air of familiarity for some hon. Members, given that the issue has been debated not once but twice in the Scottish Grand Committee where the principle of the Bill received broad support and, indeed, unopposed approval. Of course, I hope that that approval will be extended in the same spirit of harmony to today's proceedings.
The Bill is an important measure whose purpose is to secure the efficient conduct of sequestrations in Scotland in a manner that provides value for money to the taxpayer while protecting the legitimate interests of debtors and creditors. The need for reform of the Bankruptcy (Scotland) Act 1985 is widely recognised, and the Government's initiative in introducing today's Bill has been widely welcomed throughout Scotland, including by those professional bodies most directly affected by its provisions.
The new dimension injected into the proceedings today is reflected in the motion tabled by the hon. Member for Glasgow, Garscadden (Mr. Dewar) and his colleagues, proposing that the Bill be committed to a Special Standing Committee. That is suddenly the fashionable cry about legislation. The possibility of referral to a Special Standing Committee is, of course, a reform of procedure introduced by a Conservative Government a decade or so ago but unused for about eight years. I have nothing against the proposition in principle. Where some new, broad issue of policy of widespread public interest is at stake on which the special expertise of outside bodies is needed, there may in future be a case for such references. However, that hardly applies in the present case.
It was the 1985 Act which constituted the major policy change, founded as it was on an important Law Commission report. Indeed, during an earlier discussion of the measure the hon. Member for Garscadden said:
It was a long overdue and well considered modernisation of law which went back to an Act of the Scottish Parliament of 1621."—[Official Report. Scottish Grand Committee, 4 June 1992; c. 20.]
Indeed it was—but it was a technically defective reform, and we are anxious to deal in the Bill with the imbalance that it created between the interests of debtors, creditors and taxpayers.

Mr. Tam Dalyell: We may all have thought at the beginning that, as the Secretary of State says, the Bill was not a matter of great public interest, but, as time has gone by. we have all received serious and formidable criticisms. Those who know about such things think that this is a matter of considerable interest. Is this not an ideal occasion, as my hon. Friend the Member for


Glasgow, Garscadden (Mr. Dewar) suggested, to restore the machinery which allows some questioning of experts on the matter before we start?

Mr. Lang: The hon. Gentleman's point of view is shared by his hon. Friends—but not by me. As I have said, the measure has had a wide welcome from the professional bodies most directly affected, including the Institute of Chartered Accountants of Scotland, the Law Society, and the Society of Practitioners of Insolvency.
The question has been raised whether we allowed adequate consultation.

Mrs. Margaret Ewing: The Secretary of State has already referred to the concept of harmony in Scotland —and there is certainly a Caledonian consensus that the Bill should be repatriated to enable the experts available in all aspects of the subject to be consulted and to make recommendations. Will the right hon. Gentleman comment, even at this early stage, on the proposal of the Institute of Chartered Accountants of Scotland that fees could be reduced to £800 per case? We need time to deliberate on such proposals, and on the intricacies of the Bill, to ensure that the draftsmanship is correct, and that we do not have to debate an inadequate Act.

Mr. Lang: It is certainly true that some of the practitioners have sharpened their pencils since the publication of the Bill—dramatically so. There are now suggestions that it may be possible to carry out the work covered in the past by the block fee of £2,147 for less than half that sum. I believe that it was Oscar Wilde who said that the prospect of being hanged concentrated the mind wonderfully.
The hon. Member for Moray (Mrs. Ewing) has repeatedly drawn attention to that aspect of the problem, and it must be addressed, in the interests of the taxpayer. There are also the interests of the creditors and the debtors, which are addressed in the Bill.
The hon. Lady has lost me with her reference to repatriation. We do not repatriate Bills in this Parliament; we pass legislation after proper scrutiny. The measure has been scrutinised twice in the Scottish Grand Committee and will go to a Scottish Standing Committee. That is the nearest to a patriotic front that I can offer the hon. Lady.

Mr. Donald Dewar: Will the Secretary of State say a word or two more about the proposal of the Institute of Chartered Accountants of Scotland which was referred to by the hon. Member for Moray (Mrs. Ewing)? That proposal would dramatically reduce the cost of schedule 2 sequestrations, and, if it were acceptable to the Government, it would in effect rewrite the Bill by removing the essential principle of transferring the work from the private to the public sector. It would be helpful to the House, and a useful preparation for the Committee stage, if the Secretary of State would say whether he is contemplating such a shift, or holding to the general shape of the Bill, which at present excludes insolvency practitioners.

Mr. Lang: Obviously we are interested in the propositions put to us by the institute and we will study them carefully. What the hon. Gentleman has said about transferring the matter from the private to the public sector is an over-simplification, and I will deal with it later in my speech.
I want to deal with the consultation point raised earlier. The Opposition's attitude is underlined by their motion suggesting that we go to a Special Standing Committee. The urgent need to reform the Act is widely recognised; I do not accept that there has been inadequate consultation. The Government proposals have been made after careful monitoring of the operation of the 1985 Act by the Department of Trade and Industry, together with the Scottish courts administration and the accountant in bankruptcy, and the Treasury has taken an interest.
The announcement of the Bill was made in the Queen's Speech on 6 May and it was published on 8 May, at the first opportunity. By 12 May, copies of the Bill had been sent to various interested parties for comment. As Opposition Members have said, comment has flowed in thick and fast, on the whole supporting the principle of what we are doing, although raising aspects of detail that can be dealt with in Committee.
The principle of the Bill has been considered twice in the Grand Committee, on 4 and 7 June, 27 days after publication—rather more than the usual 12 days allowed —and has received unanimous approval. A further nine days elapsed before today's Second Reading, which we could call a special Second Reading; and the earliest date when the Bill can go into Standing Committee will be 30 June, nearly a fortnight from now. All that represents seven and a half weeks for representations and consultations—out of all proportion for a Bill of this size and very much more than some major Bills have been given. So there has been adequate consultation on what is essentially a technical adjustment to an earlier Bill whose mechanisms are not operating efficiently.

Mr. Brian Wilson: Since the remarkable information has emerged that the Institute of Chartered Accountants of Scotland appears to be prepared to cut its fees by 60 per cent., does the Secretary of State agree that, had the inquiry been made before the Bill, it might have conditioned its nature in another direction? Does not that suggest that consultation was grossly inadequate—indeed, non-existent? Given that that is so and that so much other information has come out since the Bill was published, is not the case justified for looking at the whole issue again?
From what the right hon. Gentleman said in reply to my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar), it seems that the whole nature of the Bill might be changed yet again in the course of its passage—if he is seriously considering this offer.

Mr. Lang: We are not contemplating changing the nature of the Bill, which enacts a number of measures unrelated to fees. The fact remains that there have been negotiations in the past with the institute about the amount of the block fee, negotiations which have secured savings amounting roughly to 50 per cent. It will be clear from the figures that I will give the House shortly that the cost of administering sequestration in Scotland has soared dramatically, however, and the Government do not have the necessary powers to control these matters on behalf of the taxpayer. Even though there is still scope for futher negotiation with the practitioners and others over the conduct of sequestration, it is still necessary for the Government to have powers in this area.

Mr. James Wallace: Those of us who have just heard the right hon. Gentleman's


illustration of what he thinks amounts to consultation will note that almost all of it has happened since publication of the Bill. The right hon. Gentleman will have to admit that, when the Scottish Grand Committee met, the main criticism of the Government concerned the lack of consultation before publication, not least with bodies such as the Institute of Chartered Accountants of Scotland, which was discussing with the accountant in bankruptcy how savings and improvements in the system could be made.
Does the right hon. Gentleman accept that a Special Standing Committee is still the best course of action; but that as the Bill cannot go into Standing Committee until a week on Tuesday at the earliest, it is unlikely to emerge from Standing Committee before the recess, so it would be much more sensible to allow the summer for proper consideration and, if necessary, to withdraw the Bill and present it again in the autumn?

Mr. Lang: No: and, as I have said, there has been a great deal of consultation. The hon. Gentleman will know that policy responsibility was transferred to my Department only in this new Parliament but that there were earlier consultations. The negotiations over the block fee between the institute and others involved are themselves evidence of the degree of consultation.
There are certain flaws in the mechanisms for delivering the sequestration process which have unbalanced matters and they must be rectified. We therefore need the Bill for several areas of sequestration other than simply the level of fees.

Mr. Thomas Graham: Is the Secretary of State aware that, because of what he calls the consultative process, many organisations are genuinely worried and support the request to set up a Special Standing Committee? Surely that is not too much to ask in view of the situation in Scotland in respect of bankruptcy.

Mr. Lang: I have already answered that general point. I understand that the hon. Member for Renfrew, West and Inverclyde (Mr. Graham) and his colleagues sincerely hold that view. However, the Government have considered the issue carefully and have decided that the Bill does not meet the criteria and the way in which they should be applied for a Special Standing Committee. As I said earlier, the Bill is not a major policy departure; it is not a major Bill in any sense. It corrects certain mechanical failures of an earlier more substantial Bill in respect of which there was no pressure from Opposition Parties for a Special Standing Committee.

Mrs. Ewing: Will the Secretary of State give way?

Mr. Lang: No. I must make a little progress and I will then give way to the hon. Lady. I have already given way to her once or twice.
I am not arguing that the Bill cannot be improved; of course it can. Almost invariably Bills are improved in Committee. I emphasise that my hon. Friends and I approach the Committee in a constructive and flexible frame of mind. We are willing to consider change as the Bill makes progress.
I believe that the representations that we have received to date have identified the key areas in the Bill that hon.

Members will wish to consider in detail in Committee. Those include concern about confining the role of interim trustee to the accountant in bankruptcy; access to sequestration by debtors; how a debtor is to finance his petition; and whether the procedures for debtor petitions can be simplifed further while maintaining a proper balance between the interests of debtors and creditors. All those issues can be properly dealt with in Standing Committee.
It may be helpful to the House if I sketch out the background to the Government's proposals. In so doing, I will try to avoid replicating the admirable work of the Parliamentary Under-Secretary of State for Scotland, my hon. Friend the Member for Eastwood (Mr. Stewart), who presented the Government's case to the Scottish Grand Committee.
The Bankruptcy (Scotland) Act 1985, which modernised the law of bankruptcy in Scotland, followed on from a detailed review undertaken by the Scottish Law Commission, as I have already said. The Act has been very successful in ensuring that in every sequestration a trustee is appointed with sufficient powers to see the sequestration through to its conclusion, and that where necessary the fees of that trustee are paid by the public purse. This latter innovation—placing on the Exchequer the responsibility for meeting any shortfall in the fees and outlays incurred by the trustee administering the sequestration—was introduced to ensure that there could be no return to the previous evil of limping sequestrations.
In such cases, the debtor might never be discharged of his obligations and creditors might never receive payment of sums owed to them, the reason being that there were insufficient assets in the debtor's estate to finance the cost of the operation. Similarly, for debtors with few assets, sequestration was not available as a means of reorganising their finances because it was impossible for them to persuade a trustee to take on the work.
In putting forward its reforms, the Scottish Law Commission did not anticipate any substantial call on the Exchequer to finance such sequestrations. In putting forward the 1985 Bill, the Government, I must acknowledge, did not see any reason to challenge this assumption by the commission and accepted the basis on which the proposals were advanced. However, since the 1985 Act was enacted, the position has turned out to be entirely different from that anticipated.
The cost to the taxpayer of financing the administration of individual sequestrations, through payment of the fees and outlays of the private sector insolvency practitioners who undertake the work, has risen from £13,000 in 1986 to £18.5 million in 1991. If the historical trends in the volume and costs of sequestrations were to continue, the costs would rise to some £50 million by 1993–94 and over £80 million by 1994–95. That is clearly an excessive amount of public expenditure and quite clearly does not represent value for money. It is therefore right that the Government should bring forward proposals to deal with the matter effectively, and, as I have said, that has been generally recognised.
The total cost to the Exchequer in any individual year is a consequence of the volume of sequestrations and the fee paid to the practitioners. Since 1986, the number of sequestrations has grown enormously, some fifteenfold, from 560 to 8,584 in 1991–92. On an annual basis, the average rate of growth has been some 74 per cent.


The nature of sequestrations has also changed dramatically in the period. Historically, sequestration has always been seen as a tool by which creditors could obtain an equitable distribution of a debtor's assets towards the repayment of the moneys owed to them. In 1986, 75 per cent. of all awards of sequestration were granted on the petition of a qualified creditor. By 1991–92, they constituted only 13 per cent. of the total.
In contrast, there has been an explosion in the number of petitions presented by a trustee under a trust deed. There were nearly 7,500 of those last year, accounting for 87 per cent. of all petitions granted. It is illuminating to examine the growth in the use of trustee petitions over the period since the 1985 Act was enacted. If the House cares to refer to the annual reports of the accountant in bankruptcy, which are to be found in the Library, it will see that the number of such petitions has grown from 31 in 1986–87 to 1,800 by 1989–90 and to 4,340 in 1990–91.
That growth is a reflection of the growing realisation amongst insolvency practitioners, money advice agencies and debtors that the trustee route provided easy access to sequestration—a route which was never envisaged when the 1985 Act was enacted.
For the benefit of those hon. Members who are not familiar with the practice, although by now most will be, the procedure is that a debtor is referred to an insolvency practitioner and is advised to sign a voluntary trust deed appointing that practitioner as trustee and transferring the debtor's estate to him to be realised for the benefit of the creditors. Having established that it is a small assets case, the administration of which will be funded by the Exchequer if the debtor is sequestrated, the trustee immediately petitions for sequestration and for appointment as interim trustee under the 1985 Act to administer the case. In due course, the same practitioner will be appointed permanent trustee and able to claim his fees.
At no time is any attempt made to operate the trust deed in the way it was originally intended—as a voluntary arrangement between the debtor and his creditors which would permit the debtor to reorganise his financial affairs without having to have recourse to the very serious step of being sequestrated. The use of the legal device of the trust deed has had the effect of detracting from the usefulness of voluntary arrangements as a means whereby a debtor can avoid sequestration.
That rapid growth in the volume of sequestrations and the change in the pattern of sequestrations is unique in Scotland. Although there has been growth in the level of bankruptcies in other parts of the United Kingdom in recent years, there has been nothing like the trend which is to be found in Scotland. Nor, when one examines the figures for corporate insolvencies in Scotland, does it show a similar growth pattern to that of sequestrations. The fact is that the level of insolvency in Scotland on a per capita basis has changed from being broadly equivalent to the level in England and Wales in 1987 to some three times that level by 1990. Those are very remarkable figures which cannot be explained in terms of relative economic prosperity or economic performance. Indeed, relative economic performance over the period has, by most criteria, moved in the opposite direction.
The Government recognise that, with the introduction of the 1985 Act. there would inevitably be some reaction in terms of the numbers of individuals being sequestrated. However, the change that we have seen cannot be explained in those terms alone.

Mr. Michael Connarty: The Secretary of State seems to be saying that the real target of the Bill is the people who need to find a way out of debt. The right hon. Gentleman's theme in the past 10 minutes has been in that vein.

Mr. Lang: Absolutely not. As the hon. Gentleman is aware, the Bill makes provision for a debtor to apply for sequestration. That was not the case before. The Bill tries to get the balance back on to an even keel between debtor, creditor and the taxpayers' interest.

Mrs. Ewing: rose—

Mr. Wallace: rose—

Mrs. Maria Fyfe: rose—

Mr. Lang: I have given way to the hon. Members for Moray and for Orkney and Shetland (Mr. Wallace) several times, so I shall give way to the hon. Member for Glasgow, Maryhill (Mrs. Fyfe).

Mrs. Fyfe: If the Secretary of State is saying that the level of sequestrations in Scotland is three times that in England on a per capita basis, and that that has nothing to do with the state of the Scottish economy, what exactly is going on? If the law in England and Wales is different from that which was passed in Scotland in 1985, is not that all the more reason for taking care and for taking time for proper consultation the second time round?

Mr. Lang: As I have said, the relative economic performance of the different parts of the United Kingdom has been moving in the opposite direction. The hon. Member for Maryhill will be aware that unemployment in Scotland is now lower than it is elsewhere in the United Kingdom, for the first time since records began. The increase in the number of company liquidations in Scotland has been small by British standards. Between 1991 and 1992, the increase was 5.7 per cent. in Scotland, compared with 31.9 per cent. in Great Britain as a whole. That demonstrates the contrast between the trend in personal sequestrations and the performance of the economy.

Mr. Dalyell: In answer to my hon. Friend the Member for Falkirk, East (Mr. Connarty), the Secretary of State gave a decisive "Absolutely not", but on the issue of small asset sequestrations, which my hon. Friend raised by implication, why does the right hon. Gentleman believe that many of us have been contacted by welfare rights organisations saying that small asset sequestrations are likely to be more frequent under the coming legislation and will hurt the most vulnerable, as my hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe) said? Why should they all be so worried?

Mr. Lang: I do not believe that that will be the case. The hon. Gentleman will be aware—indeed, I touched on it earlier—that before the 1985 Act there were particular difficulties with small asset sequestrations. The 1985 Act has considerably eased the position but has created a new procedure whereby debtors with small asset cases can go straight to an insolvency practitioner who can be appointed as an interim trustee and subsequently as a permanent trustee. The practitioner can pick up a fee of £2,147 for wrapping up the case. That has led to a dramatic surge of applications, which must reflect a


change in the attitude to debt and a recognition of the opportunity that the procedure provides for a relatively easy way out of problems.

Mr. Wallace: In all fairness, the Under-Secretary of State for Scotland, the hon. Member for Eastwood (Mr. Stewart), said in the Scottish Grand Committee that the effect of the Bill should not be to deny anyone access to sequestration other than those denied it at present. So clearly no saving should be made by reducing the number of people applying for sequestration. If it is not economic circumstances, what is the reason for the increase? Of that number, what proportion were people in self-employment?

Mr. Lang: I cannot give the hon. Gentleman the latter figure, but it may be possible to identify it; if so, my hon. Friend the Under-Secretary will give it to the hon. Gentleman either later today or in Committee. On the initial point, it is not the Government's intention to make access to sequestration more difficult. As I said, the Bill contains a provision which allows debtors direct access. My hon. Friend the Under-Secretary said that in the Grand Committee, too. The Bill also provides for the streamlining of procedures, simplification of the handling of cases, and a reduction in the fee level. It is universally recognised that that level is far too high.

Mrs. Ewing: rose—

Mr. Lang: I give way to the hon. Lady, but it will have to be for the last time.

Mrs. Ewing: Does the Secretary of State recognise that the proposals in the Bill make the process of seeking sequestration more complex? Indeed, the process may create more bureaucracy and further costs. That was identified by an individual who works in welfare rights serving the Dumfries and Galloway region. Does the Secretary of State appreciate that the proposals in the Bill mean that someone would have to approach first a welfare officer or someone in a citizens advice bureau and then a solicitor to seek legal aid? The person would then have to proceed to creditors for a protected trust deed and then seek a sheriff's ruling.
All that makes the procedure much more complex. We argue that there must be consultation because we want to ensure access and simplicity, reduce costs, and make the Bill effective. Those aspects cannot be picked up in an ordinary Standing Committee but could be included in a redrafted Bill if we had a Special Standing Committee.

Mr. Lang: I do not accept the hon. Lady's analysis. The Government would not have introduced the Bill in its present form if we had thought what she suggested. The hon. Lady makes the mechanisms that have to be pursued by a debtor sound more difficult than they are. It is clearly desirable that a debtor should have access to independent advice. Indeed, we have gone out of our way to increase the funding of money advice centres and other such organisations to enable and encourage them to give such advice.
No one should be urged too strongly to rush to sequestration. The House will recognise that where it is possible to avoid sequestration—for example, by a protected trust deed or some other way—it might be a desirable outcome. To make it too easy and too direct

would be to undermine the interests of the taxpayer, the creditor and the debtor. We are seeking to establish a proper balance and to simplify procedures within it, as far as that can be done.
The hon. Member for Moray makes a point which may well have validity. There will be an opportunity to argue that in Standing Committee when we reach the clauses concerned with procedures.

Mr. Dewar: I am sorry to butt in and to labour the point, but it is in the interests of the House that we understand the Government's position. Is it the Secretary of State's contention that, after the machinery is in operation, he expects the case load—the number of people going through sequestration procedures—to remain as it is or to drop? If he expects it to drop, are we to deduce that people who ought to be able to follow that course will be prevented from doing so? Or is he positing, as the Under-Secretary suggested—to be fair, he was quoting creditors—that insolvency practitioners are putting people through sequestration procedures because it is in their financial interests to do so but, by implication, there is no public or individual interest in following that course?

Mr. Lang: I think that the hon. Gentleman has reached that conclusion. He referred in the Scottish Grand Committee to a "gravy train" and other hon. Members have suggested the same. I hesitate to give a forecast on the number of debtors who will seek sequestration. Given the Government's collective record on such forecasts since 1985, it might be unwise to do so. I advance the theory that the Bill is broadly neutral in that sense and seeks to achieve a better balance between debtor and creditor and, by streamlining procedures and reducing fee levels, to reduce Government costs substantially.
I earnestly hope that the Bill will avoid the dramatic escalation of such applications in recent years, with their frightening implications for public expenditure.

Mr. John Home Robertson: Will the right hon. Gentleman give way?

Mr. Lang: No; I must make some progress. I shall give way to the hon. Gentleman later.
What is very clear is that the trend is causing considerable alarm amongst creditors, who view with great concern the growing pattern of sequestrations in Scotland. They have expressed the fear that the present law could work against the public interest by providing an incentive for the marketing of sequestration as a solution to debt problems, since on the face of it the debtor has little to lose and the practitioner has a considerable amount to gain if a debtor is sequestrated.
I fully accept that the majority of debtors enter into sequestration only after receiving careful advice from money advice centres and others and from the insolvency practitioner who handles their case. Nevertheless, the loss of faith amongst creditors in the sequestration process must be a matter of concern to the House.
Sequestration and the laws of bankruptcy have always been rightly seen as underpinning the operation of the credit market. Parliament has sought to maintain a balance between the interests of debtors and creditors. There is a real danger that we have inadvertently created a situation which has lost that sense of balance and which works against the interests of creditors as well as taxpayers.


There is no doubt that the present law can give rise to a potential conflict of interest on the part of the insolvency practitioner. It certainly causes confusion as to whether the practitioner is acting in the interests of the debtor or in the interests of the creditor. Prior to the signing of the trust deed, the practitioner offering advice is acting for the debtor, but by law he must act in the interest of creditors once a trust deed is signed or sequestration is awarded. The present arrangements blur that important distinction.
Under the present regime, an insolvency practitioner is entitled to be reimbursed with his fees and outlays from the Exchequer, where there are insufficient assets in the debtor's estate to finance the sequestration. In some 80 per cent. of all sequestrations in 1991–92—in some 6,800 cases —there were no assets in the debtor's estate which could be realised for the benefit of the creditors. Yet, despite that, the insolvency practitioner is entitled to receive a block fee of £2,147 from the Exchequer for administering the sequestration. The House has every right to question whether such a payment represents value for money to the taxpayer. I do not believe that it does.
Moreover, under those arrangements the Government's powers to secure an improvement in the cost to the taxpayer are severely limited. While the 1985 Act gives responsibility to the accountant in bankruptcy to determine the level of remuneration to be paid to a trustee in a sequestration, he is required in exercising his discretion to take account only of the work which has been reasonably undertaken by the trustee—having regard to the value of the debtor's estate—and to the extent of the trustee's responsibilities in administering the debtor's estate. In so far as a trustee can demonstrate that he has conformed to the requirements of the 1985 Act in administering the sequestration, the accountant in bankruptcy has little alternative but to pay the fee charged. The Act certainly does not provide for the accountant in bankruptcy to take account of the interests of the taxpayer, who, after all, is being required to meet the bill, in setting the level of remuneration.
I acknowledge that the problem was recognised by both the accountant in bankruptcy and by the insolvency profession itself. As a result. and in an effort to reduce the demand on the public purse, the Institute of Chartered Accountants of Scotland and the accountant in bankruptcy entered into a voluntary agreement, as I said earlier, to allow the introduction of a block fee agreement, which covers the vast majority of sequestrations. Most cases are now dealt with under this new regime.
The accountant estimates that by this means the cost to the Exchequer has been reduced by some 50 per cent. of what it would otherwise have been if insolvency practitioners had continued to charge on the basis envisaged in the 1985 Act. However welcome this improvement, it is not a basis on which to continue the regime into the future. The Government believe that the reforms being introduced by the Bill are essential if we are adequately to protect the taxpayers' interests and secure value for money.

Sir Nicholas Fairbairn: I hope that my right hon. Friend will say something about the interests of the creditor. The creditor's interest is to be paid in full. Insolvency, sequestration and bankruptcy frustrate his proper right.

Mr. Lang: As I said earlier, once the trust deed has been signed, the law requires that the interests of the creditors are paramount. My hon. and learned Friend is absolutely right. It is a matter of balance. I have referred to creditors on a number of occasions, but I am glad to underline that we must achieve a balance. After all, the creditor is probably the most innocent party of all those involved in such sad affairs.
I stress that it is not the Government's intention to secure value for money by denying debtor's access to sequestration—quite the reverse. As I have said, for the first time, debtors will be able to petition for their own sequestration if the Bill is enacted. Instead, we will secure better value for money through simplifying the procedures which apply to sequestrations where there are few assets, and by tighter control over the fees paid to the insolvency practitioners.
The Bill itself is principally an enabling measure and ensures that the administrative responsibility for sequestrations is brought alongside the financial responsibility, which, as I have explained, is already borne by the public sector.

Mr. Dalyell: The right hon. Gentleman says that he wants tighter control over the fees paid to sequestrators. How will he bring that about? We know from our constituency work that it will be very difficult.

Mr. Lang: We are taking powers in clause 8, as the hon. Gentleman will discover if he serves on the Committee. Such powers do not exist now and, without them, the public interest is not protected adequately, as the past seven years' experience has shown.
The Bill places the responsibility for the conduct of sequestrations on the accountant in bankruptcy, who is a public official appointed by the Secretary of State. The accountant will have the responsibility for ensuring that an efficient, cost-effective sequestration service is operated in Scotland in a manner that not only meets the needs of debtors and creditors, but protects the interests of the taxpayer. To that extent, the accountant's role would be analogous to that of the insolvency service in England and Wales and in Northern Ireland.
It would take me a long time to go through all the clauses, but the general outline of most of them is familiar to the House. However, 1 shall touch on some of the concerns raised in earlier debates. I can best do that by referring to some of the more important clauses.
Clause 1 enables the accountant in bankruptcy either to employ his own staff to undertake his duties or to employ agents to carry out the work on his behalf. As my hon. Friend the Under-Secretary of State has already explained in previous discussions, such agents could be insolvency practitioners who had contracted with the accountant in bankruptcy to provide a sequestration service in particular parts of the country. By a combination of the use of his own staff and of insolvency practitioners, the Government are in no doubt that the accountant in bankruptcy will be able to provide an efficient service across the country—I know that the hon. Member for Orkney and Shetland was concerned about that. Therefore, the risk of the process being centralised in Edinburgh which the hon. Gentleman and a number of other hon. Members feared can be avoided.
It will come as no surprise to the House that the Government are fully committed to market-testing the


delivery of the sequestration service in accordance with the principles that we have established. We shall look closely at the detailed implementation of the Bill to ensure that wherever possible, the private sector has the opportunity to undertake the work where that can be done in a cost-effective manner. I say that in response to the undertone of anxiety which I detected from earlier debates in the Scottish Grand Committee that too much might be concentrated in the hands of the state. At present, the advice agency, which directs the debtor to an insolvency practitioner, determines who shall act in a sequestration in most cases. Neither the creditor nor the taxpayer, who is paying for the process, has a say in the matter. The chosen practitioner is in a monopoly position. Provided that he maintains a good relationship with the advice agency in handling its clients, he can be confident of a steady stream of work. In future, the accountant in bankruptcy will be in a position to introduce a much stronger dose of competition into the process. By tendering out the provision of the service to insolvency practitioners, he can ensure that value for money and quality of service are secured. The best and most efficient and effective practitioners are likely to gain from that process.

Mr. Wallace: One of the important issues that arose in the Scottish Grand Committee was the fact that, at present, a debtor who went to an insolvency practitioner could be advised that there was no need for sequestration. Do the Government intend to allow the accountant in bankruptcy or those acting on his behalf to tender similar advice, or does the Bill mean that, by the time someone goes to the accountant in bankruptcy, the threshold has been crossed?

Mr. Lang: The accountant in bankruptcy does not have the role of tendering advice; indeed, he has no right to do so. That is why the money advice centres, citizens advice bureaux and access to a solicitor with legal aid are important parts of the overall package.
Clause 2 provides for the appointment of the accountant in bankruptcy as interim trustee in all sequestrations. I am conscious that the concentration of the responsibility for acting as interim trustee in the hands of the accountant in bankruptcy has caused concern in a number of quarters. It has been suggested that the accountant would not be able to deal with trading businesses—the hon. Member for Falkirk, East (Mr. Connarty) raised that issue in the Scottish Grand Committee—or other cases where creditors require a trustee to be put in place at the earliest possible opportunity. I understand that fear.
The Bill gives the accountant in bankruptcy precisely the same power as is currently available to an insolvency practitioner to protect a debtor's estate. He may also be appointed quickly to ensure that those assets are not dissipated. In practice, however, the particular requirements of a trading business would probably justify the accountant in bankruptcy employing an insolvency practitioner as his agent to undertake the administration of the sequestration. The Bill enables the accountant to do that.
Nevertheless, as my hon. Friend has said, the Government are sympathetic to the argument that the private sector should be allowed to undertake the work

directly as interim trustee where there is no likelihood of any call being made on public funds to finance the sequestration. We are actively considering specific amendments to the Bill which would enable such an arrangement to operate. I realise that that aspect of the matter concerned several hon. Members earlier in our discussions.
On the basis of a proposal, originally put forward by the Scottish Insolvency Practitioners Joint Liaison Committee, whom the Government have consulted extensively on the Bill, those arrangements would allow a creditor or debtor to nominate an insolvency practitioner in cases where there are sufficient assets to finance the cost of the sequestration. Provided that we can be satisfied that such an arrangement is workable and will not give rise either to limping sequestrations or a future demand on public funds, we would be prepared to consider amendments to the Bill in Committee to deal with that matter.
The enactment of the Bill will improve the handling of sequestrations for the benefit of debtors, creditors and taxpayers. It builds on the experience of operating the 1985 Act and rectifies the flaws that can be clearly perceived in its administrative arrangements. I recognise the legitimate concerns that have been expressed about the effect of several provisions. I hope that I have given sufficient assurance that the Government will approach the Bill's Committee stage constructively. We are prepared to listen carefully to reasoned arguments. I have no doubt that the Bill will emerge strengthened from that process, and I commend it to the House.

Mr. Donald Dewar: I beg to move, to leave out from "That" to the end of the Question and to add instead thereof:
this House declines to give a Second Reading to the Bankruptcy (Scotland) Bill because of the inadequate opportunity for consultation between the Government and interested bodies in Scotland on the contents of the measure.
I must confess that Scottish politics are full of unexpected pleasures. The House will not be surprised to hear that no one's heart missed a beat at the news in the Queen's Speech that the law on bankruptcy in Scotland was to be adjusted. However, the Bill has turned out to be interesting. It is full of unlikely facts, bizarre circumstances and at least a hint of a reversal in normal political roles.
I enjoyed watching the Under-Secretary of State, the hon. Member for Eastwood (Mr. Stewart), who seemed to have been brought from the substitutes' bench as a late replacement for the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton) to introduce the Bill. He clearly enjoyed the prospect less and less the more he read about it. It is not a fit fate for such an enthusiastic member of the No Turning Back group to find himself presiding over such a snappy little nationalisation measure. If that is part of the striving for a better character in Scotland that we are promised by the Government, I welcome it.
Today's event is unusual: the debate is about the merits of the matter. The House is being invited to give a Second Reading to the Bill, but there is a sub-theme—the question why the Bill is being debated here at all. As the Secretary of State factually reported, the Bill was discussed for not one but two days in the Scottish Grand Committee. I made no objection to its referral to that Committee, as that semed an appropriate way to deal with the Bill where there


was no head-on political collision over a matter of principle. There was no root and branch opposition; we recognised that there was a problem, to which a solution had to be found. I do not intend to rehearse in great detail the arguments deployed in the Scottish Grand Committee, but the nature of the problem must be described and considered if the present argument about the procedure —the sub-theme to which I referred—is to be understood.
The Secretary of State made it clear that the genesis of the debate goes back a long way, to the Scottish Law Commission's report of 1982 and its wide-ranging review of the law on bankruptcy. I do not object to being quoted to the effect that that review was long overdue as I do not think that that greatly affects the subsequent argument —it was long overdue. As the Secretary of State said, the Scots statute of 1621 was then the basis of the law. Whatever respect I have for the work of the 17th-century Scottish Parliament, I am not such a purist as my hon. Friend the Member for Dundee, East (Mr. McAllion) and believe that mistakes may have been made in 1621, especially when we look at the circumstances that prevail today—[Interruption.] I am glad to say that I did not hear the sedentary interruption by my hon. Friend the Member for Dundee, East.
There was a case for a review, which was designed partly to consider sequestration procedure. As the House knows, sequestration is a way of regulating the affairs of a debtor, protecting both the debtor and the creditor, and attempting to create order in someone's affairs when they are in chaos. One of the odd by-products of the law as instituted in 1985 was that, while it cured one defect, it created a great worry for the Government. The defect that we were trying to cure was the anomaly of a rich debtor —if that is not a contradiction in terms—being able to take advantage of professional help and sequestration law in a way not fully available to a debtor at the bottom of the pecking order. There was a simple and, possibly, human reason for that.
If the sequestration case involved assets—regardless of whether the debts outweighed the assets—they could be used to pay for professional fees, which have a first charge on assets. Therefore, it was possible for such a debtor to engage professional help because the money needed for the fees was protected. Conversely, if the case involved virtually no assets, the insolvency practitioner was unlikely to give of his or her time and trouble with no prospect of reward. The Law Commission properly argued that that state was not right and suggested the principle correctly accepted in the 1985 legislation—that the state should take responsibility for the costs of sequestration in a small assets case that was likely to be barred for the practical reasons that I have described.
In the Scottish Grand Committee, I mentioned the quaint, old-world atmosphere that prevailed in the Law Commission's report of 1982, which assumed that drafting legislation to give the state responsibility for paying fees would probably produce between 120 and 150 new sequestration cases a year and result in a total cost of fees to the public purse of between £6,000 and £7,500.
After 1985 the floodgates opened. There is controversy, and I suspect more controversy to come, about exactly why that happened. In 1985 there were, not between 120 and 150 cases, but 295 sequestrations. By 1991 the number had risen to nearly 8,000. Instead of a top limit of £7,500, the state was paying insolvency practitioners £18.5 million.
I accept that that is a massive sum. I received one letter from an ingenious and brave insolvency practitioner who suggested that the sum was small when measured against the costs of the poll tax. It did not seem to be an argument likely to soften the heart of the Secretary of State, but I leave it on the Dispatch Box in front of him. No doubt he can consider it. To be serious, it is a large sum. The figures mentioned in the press over the weekend suggested that the projected cost of the entire civil legal aid scheme for the state in 1991–92, at £16.6 million, was considerably less than the fees paid to insolvency practitioners.
It is well known to anyone who has followed the debate, even superficially, that we have in the memorandum to the Bill the exciting prospect that the £18.5 million will soon be dwarfed and that in 1993–94 the Government expect to pay £50 million and in 1994–95 £80 million to insolvency practitioners. In fairness, when that was put to the Under-Secretary, he bravely suggested that the figures were merely an extrapolation of a trend. I think that he was inviting us to take the view that the material in the financial memorandum should be disregarded and was worthless. If that was not his intention and we are to take these figures seriously, they are indeed spectacular.
The Institute of Chartered Accountants of Scotland, perhaps rather meanly, pointed out that, on the present fee pattern, by the middle of this decade there would be 40,000 sequestrations a year in Scotland. That does not suggest that the Scottish Office is wholly convinced of the imminence of economic recovery, but there we are.
I accept that the situation cannot be shrugged off. Obviously, the Scottish Office is unhappy. If it is not unhappy, we can bet our bottom dollar that the Treasury is. If I may mix metaphors, I suspect that Ministers smelt, if not a rat, at least a gravy train, as the Minister remarked. and one that should be derailed.
I do not know entirely what Ministers' real thoughts on the matter are. During these exchanges we have tried to get to the bottom of them. The Under-Secretary of State was careful to say that he was not accusing insolvency practitioners of any sort of improper practice; he was only reflecting the views of creditors that they were pushing people into sequestration to make financial gain. It was a case of "some people say". In my experience, when that argument is used, there is at least some sort of endorsement by implication from he who spreadeth the rumour. In any event, we shall have to probe that later.
It is clear that insolvency practitioners—there are about 220 of them in Scotland and in recent years they have, indeed, been a happy band of brothers—have done extremely well. They are mostly accountants. The figures have been extracted by the hon. Member for Moray (Mrs. Ewing) through parliamentary questions that are well known to those of us who attended the Scottish Grand Committee debate. They reveal that those in the premier league have done extremely well. In 1991 one firm, not a great international firm but a home-grown example of entrepreneurial skill, took £3.427 million in fees from the state.

Mr. John McAllion: Name it.

Mr. Dewar: Pannell Kerr and Foster is the name, as I am invited to give it. It was followed by Ernst and Young with £2.2 million and Cork Gully with £1.9 million. The names are public knowledge as a result of answers from Ministers. That is the background to the problem.


It is because the Opposition recognised that there was a problem that we were happy to look at the solution to see whether some way forward could be found on the basis that, with one or two exceptions such as the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990, debates on law reform Bills in this Parliament tend to be productive, and there was no reason to think that this Bill would be an exception.
Unfortunately, the going has become rather hard and I must confess that I am unhappy about the Government's approach. There is no doubt at all that the chosen solution, although the Minister does not like it, was, as I said earlier, a matter of nationalisation; what I described in the Scottish Grand Committee as a good old-fashioned dose of the same. The work is being moved from the private to the public sector. In all cases, the interim trustee in sequestration, unless it is decided to employ a private sector professional as his agent, will be the accountant in bankruptcy.

Mr. Wallace: I am sure that the hon. Gentleman was as bemused as I was to hear the Secretary of State's justification that there would be competition in the tendering of the services to be provided by the accountant. If the legal aid bill seems to be getting out of hand, does the hon. Gentleman see some future in, as it were, nationalising the legal profession, and having an official legal aid solicitor who would ask for tenders from different private solicitors throughout the country for the handling of legal aid? Is not the important point that an element of delectus personae has been lost?

Mr. Dewar: Yes, that is undoubtedly so. That element of delectus personae has, by definition, been lost, causing particular irritation in non-schedule 2 cases among the accountancy profession. Delectus personae might also be an issue in schedule 2 cases, but I have not pushed that because, given the general picture, there is a case for allowing the accountant in bankruptcy to undertake the work. But before that happens, we need substantial assurances about the way in which the new system will be organised and operated and whether it will allow people, not necessarily to have the professional adviser of their choice, but any professional adviser at all. That is the key to the argument and to the unhappiness of a large number of the welfare organisations which have made representations to us.
The Under-Secretary made it clear when he introduced the Bill that his favoured solution was that the accountant should be banished from the scene and allowed to return only under sufferance as the agent of the accountant in bankruptcy, and that civil servants should rule in his stead. His analysis was clearly that this was an area where the market had not worked as it should and where the profit motive had worked too well. As a result, he was prepared to advocate to the House—all credit to him because it cannot have been easy—that the work be taken away from the private sector and given to the accountant in bankruptcy, and that, as a concomitant of that, we should contemplate the appointment of 85 new civil servants in 1993–94 and 120 in 1994–95 to undertake the additional work load. That is what we are being asked to contemplate and that is what the hon. Gentleman is personally recommending.

The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart): In a number of respects, that is not precisely what I said, but I will come back to that later if I am successful in catching your eye, Mr. Deputy Speaker. So that the House is clear, will the hon. Gentleman confirm that I did say, as my right hon. Friend confirmed in his opening remarks, that we were sympathetic to the amendments that had been put forward on non-schedule 2 cases?

Mr. Dewar: Absolutely. It came as no surprise to the Opposition that the Government were prepared to make concessions on that. I understand the arguments for that and I am happy to leave the matter to the Committee stage when we can examine it in some detail. I want to return to other aspects of the accountants' case, but I must push on. Having described the problem and the Minister's favoured solution, I come to why we believe that it is right that the Bill's next stage should be in a Special Standing Committee.
The House will know that a Special Standing Committee has up to four sessions which allow Committee members to take direct evidence from interested bodies and parties as though they were a Select Committee. I believe that I was the first to suggest such an arrangement: my suggestion can be found in column 20 of the Hansard report of the Scottish Grand Committee debate that took place on 4 June.
The main reason for my suggestion. and, I think, for the widespread support that it has gained from my colleagues and from other parties, is the fact that the Bill involves many complex and technical matters. There have been major protests about what are seen as unintended consequences of the legislation. It has been suggested that Ministers have a hidden agenda, and there is a suspicion that many people who require help, and who may benefit from the sequestration procedure, will be effectively excluded by some of the barriers built into the Bill.
Such views have been expressed not only by accountants and lawyers—who might be thought to have a vested interest—but by welfare organisations of almost every kind. It is fair to say that there is scepticism everywhere; even, I suspect, among the Ministers who are handling the Bill.
My second reason for believing that the Bill should be dealt with by a special Standing Committee is the number of complaints that have been made about the lack of consultation. I do not intend to illustrate that by means of lengthy and copious quotations; however, I do not think that the Minister would deny that a single message has emerged from almost all the representations that have been sent to hon. Members.
Let me mention my own constituency first. Obviously, I am interested in what has been said of the Drumchapel law centre, and in the views of the Tackling Debt group, which is based in the Castlemilk law centre and represents a wide consortium of interests. Similar opinions have been expressed by the Scottish Consumer Council, a statutory body funded by the Government; by Citizens Advice Scotland, which has a uniquely wide experience of practical counselling on debt; by the Institute of Chartered Accountants of Scotland, and by the Law Society of Scotland, which was caught completely on the hop by the Bill's appearance.
I could, if I wished, underline the message that has emerged from those organisations with many quotations.


They were astonished when the Bill, fully formed and finalised in every detail, appeared in print at the Vote Office: they had had no knowledge of it, and had not been consulted about its contents. That is unsatisfactory, to say the least. Surely the discontent that has resulted is a strong reason for establishing a Special Standing Committee, allowing interested groups to argue their case and enabling the Committee to examine that case.
There are, in my view, two broad areas of concern. I shall describe them in shorthand, as it were. First, there is the welfare point about exclusion, to which I have already referred. It is said, for example, that the accountant in bankruptcy can be brought in only by means of a petition to the court, and that the costs of that petition are immediately covered in the block fee paid to the insolvency practitioner. It is argued that, if the insolvency practitioner is removed from the scene, in many cases the debtor may have to bear the costs, or they may have to come from the assets of the sequestration; debtors may not be able to afford that.
Such consequences may substantially reduce the number of people who can use the proposed procedures. That is an important reservation: if justified, it suggests that those who most need counselling and the help afforded by sequestration to order their affairs will be denied such assistance. Admittedly, in his closing speech on the second day of the Scottish Grand Committee, the Minister—the hon. Member for Eastwood—made it clear that that was not the Government's intention. He said that any savings would come from the streamlining of procedures and the cutting of moneys to be paid in fees to insolvency practitioners.
Nevertheless, despite that statement—which came a little late in our proceedings—there are many lingering fears, which are widely shared. I remind the Minister of a point to which I referred before—the written answer by the Under-Secretary of State for Scotland, the hon. Member for Edinburgh, West, in which he said:
It is clear that the major factor influencing the number of sequestrations in Scotland is the easier access by individuals to the sequestration process … The Government are actively considering the need for changes to the present legislation."—[Official Report, 16 March 1992; Vol. 205, c. 821.]
Indeed they were.
I am sure that the hon. Member for Edinburgh, West, who is here today, will understand that the implication of the statement that the number of sequestrations is the major factor at the root of the problem is that the number of sequestrations must be cut. I shall read with care what has been said today by the Secretary of State for Scotland. However, everything that he said reinforces rather than removes that particular doubt, which is almost universally shared. Those organisations that have made it clear that they have such fears should be given the chance to make a direct contribution to the proceedings of a Special Standing Committee.
I wish also to refer to a matter that is of particular interest to accountants. They have made many points—for example, about delectus personae, a point to which the hon. Member for Orkney and Shetland (Mr. Wallace) referred. Advice should be available over a wide area. I know that the Minister is seized of that point. One also has to consider whether the accountant in bankruptcy is the most appropriate way to preserve creditors' assets in non-scheduled cases. These matters could be dealt with in a Special Standing Committee.
Full consideration should be given to the fundamental nature of the recommendations made by the Institute of Chartered Accountants of Scotland in the letter that some of us received today. The institute challenges the whole basis of the Bill. The Bill would remove the power, except under licence, for accountants to be interim trustees in sequestration. It gives that power to the accountant in bankruptcy.
The Institute of Chartered Accountants of Scotland says that that is unnecessary and that it can still be dealt with by the private sector at a very reduced cost. It suggests that there should be a simplified procedure under which fees could be cut to about £800 in cases where assets amount to less than £2,000 and debts to less than £20,000 and that in addition the outlays would amount to £200. The institute reckons that the sum of £18.5 million in 1991 could be cut to £10.5 million. That would mean rewriting the Bill. The Government have to tell us whether they are prepared to consider such a solution.
We pressed the Secretary of State on the issue. He did not appear to rule it out when he said that it would have to be closely considered. If a fundamental point of that kind is to be made, I cannot think of a better place for it to be argued than a Special Standing Committee. The profession should be given the opportunity to put its case and to answer questions. In that event, the arguments would not be transferred and inevitably distorted to some extent by means of a third party—a Minister. In view of the important amendments that we are asked to contemplate, there should be direct access to the parliamentary process. I hope that, at the end of the debate, the Minister will say that the Government are prepared to contemplate this proposition. If so, it would amount almost to a wrecking amendment, so fundamentally would it change the Bill.
No Special Standing Committee has ever considered Scottish legislation, although this specific machinery has been used seven or eight times for the consideration of English legislation. I genuinely believe that this would be an appropriate Bill for that machinery. It raises non-contentious issues in a narrow political sense, but contentious legal issues with economic and social consequences for individuals who are already disadvantaged, and I believe that many hon. Members will want to probe those issues. I cannot remember a technical Bill causing so much interest from Scottish bodies with expertise to offer.
It is only common sense to use the new procedure, and I deeply regret the fact that the Secretary of State has adopted such an obdurate attitude. I hope that in the couple of hours available to him he will consider some of the speeches that he has made in the past few weeks about the government of Scotland and how Westminster handles Scottish affairs. We have been told that there will be a new sensitivity and a tireless search for improvements within the structures of Westminster. The Secretary of State said that there is certainly room for reform. We are now presenting him with a modest opportunity to prove that and to show a touch of imagination, but we find a brick wall—a dogged refusal to act.
It is easy for the Secretary of State to smile, but he does not know what is in his own best interests. The way in which he has handled the matter undermines his credibility and respect for his protestations that he is, to some extent, a reformed character. It is a pity, and if our proposal is not adopted, we may end up with a Bill that is not as good as


it should be, certainly not as well considered as it should be, and we shall have legislation which will leave many well informed and relevant bodies in Scotland feeling that they have been short-changed and not involved as they should have been.
I shall not advise my right hon. and hon. Friends to vote against Second Reading, because there is still a great deal of work to be done and I do not object to our having the opportunity to discuss the problems. However, I shall certainly advise them to vote for the motion to consider the Bill in a Special Standing Committee. I also urge the Government, even now, to think again about their attitude.

Mr. Bill Walker: There is no doubt in the minds of those in Scotland who are interested in the issue that the Bankruptcy (Scotland) Act 1985 had to be amended. That is the general view expressed in the correspondence that all hon. Members have received.
The hon. Member for Glasgow, Garscadden (Mr. Dewar) made an interesting and informative speech, but he overstated the case. He and I know that, whenever we discuss legislation in Committee, we are showered with correspondence from interested parties. To suggest that there is something new in what is happening with the Bill implies that he has forgotten all the hours that we have spent in Committee. I have with me all the correspondence that I have received since we first had sight of the Bill. I hold it up for the House because it is important. It is about one third of what I always receive on other Scottish Bills, and equally important legal Bills.
Let me make it clear that I, too, want the Bill to be amended, but that will not surprise anyone, because there is frequently cross-party agreement among Back Benchers in Committee when we discuss Scottish legislation, and we often get the Government to change Bills. What is interesting on this occasion is that the Government said at the outset that they wanted to adopt a flexible and responsive position. I cannot say in all honesty that that has always been the case in Committee.

Mr. Wilson: Does the hon.Gentleman agree that, if the Government were to accept the proposition that insolvency practitioners should cut fees by 60 per cent. but otherwise continue much as before, it would be a fundamental change to the Bill? If so, would it not have been a good idea to find out about that before the Bill was introduced rather than at this stage?

Mr. Walker: The hon. Gentleman will also agree that one finds changes of such magnitude among those with vested interests—that has certainly been true for all the other Bills that I have considered in Committee—once the Bill has been printed. Once they begin to realise what may be changed in the playing fields to which they have grown accustomed—whoever they are—they start to examine the small print after the Bill has been printed and start to make proposals. That is not novel or different.
It is interesting that, in trying to find a balance between the interests of the debtors, creditors and taxpayers, so much emphasis has properly been placed on those who find themselves in debt and cannot see a way out. One issue has worried me for a long time, and hon. Members will

probably concur. In our constituencies, we meet individuals who have allowed themselves to be locked into a situation, and only after they are locked in do they begin to realise what it means. To such individuals, sequestration may appear to be an easy way to resolve their difficulties at any given time and the only way to put one's affairs in some order. However, one should not enter into it lightly without having thought it through properly.
Let us consider the case of a young man who has his whole life ahead of him. Perhaps he has written off a car or something similar and finds that he is insolvent. Under the Act, he may be advised that the easiest course open to him is sequestration. He may have an income which, although not vast, may increase. He may hope to get married, as most people do, and obtain credit to buy a house or get a mortgage and to obtain credit to furnish it. That is the natural thing to do, but if he has entered into the system under the 1985 Act, taken the advice given to him and become sequestrated, he will find to his horror that, although he has a regular income, he will not be able to obtain credit because he is barred. That could have a damaging impact at an important time in his life.
The income and potential income of an applicant should always be considered, not only because it is in the interests of the creditors-and it is-but because it is probably in the best interests of the young person who has opportunities ahead of him. That is why the Bill needs to be amended.
We must get the balance right and accept the need for reform. The hon. Member for Garscadden referred to the view set out by the Institute of Chartered Accountants of Scotland in its letter which said:
What is at issue is the cost of cases funded by the public.
The fact that that is the institute's position does not surprise me, given the amount of money that goes to its members. So we must accept that the institute, too, has suggested revised proposals. What it offers is interesting, but before we comment on its proposals, we shall want to examine them in detail. We can best do that by examining them in Committee as soon as possible.
I hope that in Committee we shall also take the opportunity to look after the interests not only of taxpayers—important though those are—but of creditors. Under the 1985 Act, sequestration is an automatic process. If formal preconditions are met, the court must make an order, and the merits of each individual case are irrelevant. Neither the sheriff nor the creditors can stop the process on the ground that sequestration is not appropriate. I have cited one instance in which I believe sequestration may not be appropriate, and there will be others.
That defect is compounded by the lack of advance warning given to creditors. Most will learn of the sequestration only after it has been awarded, and that is unsatisfactory. I hope that we shall be able to amend the Bill to allow creditors to argue that an award should not be made, and to require the court to refuse an award if it is believed that the debtor can repay his or her debts over a reasonable period. That is in the best interests of the debtor as well as of the creditor, because it does not do to find oneself debarred.
I hope that in Committee we can introduce and discuss amendments about a simple and cost-effective way of requiring a court to establish a debtor's free income and, if appropriate, to require him to pay that over for distribution to the creditors. I should have thought that it was our duty to all three parties—especially to the


taxpayer—to examine that idea carefully, because the allure of sequestration for many is its practical effect on their income at the time of the award.
In theory, section 32 permits the sheriff, on the application of the permanent trustee, to make an order for contribution from income. In practice, the section is ignored; thus the debtor's income remains untouched. There are probably two reasons why the section is not used.
First, creditors have no way of triggering use of the section. It appears to be a matter entirely within the discretion of the permanent trustee. Even if creditors could trigger the section, any contribution from income would be swallowed up in repaying the state expenditure paid to the insolvency practitioner. Secondly, insolvency practitioners, as permanent trustees, are unlikely to trigger the section of their own volition, because it would make sequestration less palatable for debtors, which in turn would have an impact on practitioners' earnings, because fewer people would use sequestration.
I make no apology for saying that I believe that there are forces afoot in Scotland that have not been giving the best possible advice to individuals. I realise that there are those who will suggest that that is a heartless view, but I have always felt that one must examine carefully the direction of the route along which we are pointing people, especially young people. If we are sending them into a cul-de-sac—that is what sequestration is—we must be certain that that is in their best long-term and short-term interests.
The Bill gives us a rare opportunity to consider again in depth how we can balance the interests of creditors, debtors and the taxpayer—there is no doubt that there is now an imbalance. I make no apologies for my hope that during our debates we shall elicit assurances from the Government. I stress the fact that we have no wish for the Bill to prevent those unfortunate enough to find themselves in great financial difficulty from taking a course that will assist them to get their affairs into some sort of order and allow them to begin what one would hope would be a return to a normal financial position, in which expenditure and income are in some sort of balance.
We have a duty and a responsibility to the taxpayer to make certain that what we put into statute does not encourage people, under the private enterprise guise of opportunism, to make a lot of money at the taxpayer's expense. Sequestration makes money out of other people's misery, and anyone who thinks that it is other than a miserable process cannot have spent much time with people forced into it.
In Committee we should not necessarily spend our time examining what the vested interests tell us, but having received many representations—as we do on every Bill—we should discuss, in a non-partisan way, constructive thoughts and ideas on how to bring the whole business of debt, credit and all that they mean into balance. That would benefit the majority of people in Scotland, most of whom are the taxpayers, who pick up the tab.
I have said before in Committee that we often forget—at least, people who adopt the bleeding heart approach often forget—that in the end all debts have to be paid. Debts do not vanish; they are paid, either by the consumer who takes the services and goods after the debt has been incurred and not paid, or by somebody else. The shopkeeper in the high street has to adjust his prices, and providers of services have to adjust their prices to include

an element for bad debt. That is how debts are paid for. The cost of administering the legal aspect of sequestration, where that is required, is picked up by the taxpayer. There is no such thing as a debt that is written off. Debts have to be paid for. The question is whether we get the balance right.
When we examine that question in Committee, I hope that it will not be a case of one side simply trying to reduce the taxpayer's input—although we have a proper duty to the taxpayer to do that. We must also ensure that we do not lock people into a situation in which they do not get the best advice and cannot see an alternative escape route.
I have found some of the correspondence that I have received from the welfare bodies disturbing. They seem to think that the only route is sequestration. I have read that correspondence carefully; I will not take up the time of the House by quoting it, but I have it all with me. I was disturbed at the absence of balance. I do not doubt the integrity of welfare workers, but if they want to proffer the best advice, they have a duty to ensure that it is the best.
I question some of that advice because of what I have discovered in my constituency. The hon. Members for Garscadden and for Linlithgow (Mr. Dalyell) rightly said that we should go by our constituency experience. It conditions our views on these issues. It is always heartrending to learn about people in these ghastly circumstances, which have arisen because of a failure of control.
Does my right hon. Friend the Secretary of State have any information about the way in which debt is apportioned in Scotland? How much of it, for instance, is arrears of rent? Perhaps we should investigate how rents are collected by local authorities. Perhaps the old system of weekly collection was better and enabled people to keep up with their payments because they budgeted on a weekly basis. That is how people on these estates live.
When I was a boy, Lawson's of Dundee went around the streets of Dundee picking up people's weekly payments. That form of debt collection was geared to suit the budgets of people who lived by budgeting from week to week. Removing that system introduced instability—[Laughter.] I do not find this a laughing matter. People who live comfortably, as we all do, frequently forget the problems of those who have to budget from week to week, as many of our constituents do. I do not mean to be frivolous when I say that we are not debating an abstract issue: it is real for those involved in it. That is why I welcome the chance to speak in this debate.
I hope that the Opposition will recognise that the Government have clearly intimated that they are prepared to accept amendments and to consider changes to the Bill. We must approach it constructively, avoiding the sort of nonsense that we witnessed during the first sitting of the Scottish Grand Committee. We must approach the Bill with concern for our constituents and others; we must not play silly political games.

Mr. John McAllion: I will not follow the comments of the hon. Member for Tayside, North (Mr. Walker). He warned us against the bleeding heart approach. No one would ever accuse him of such an approach to those with debt problems in Scotland. On the contrary, he has been one of the supporters of Government policies that have forced people into poverty


and debt in Scotland for many years now. It was sanctimonious of him to make the sort of sickening speech that he has just delivered.

Mr. Bill Walker: rose—

Mr. McAllion: I will not give way to the hon. Gentleman, who spoke for far too long anyway.
Originally, the Opposition did not intend to oppose the Bill. We intended to let it proceed without dividing on Second Reading and to consider its principle in the Scottish Grand Committee. Yet here we are today after two sittings of that Committee and more than four hours of debate in it, facing another three and a half hours of debate this afternoon on a three-line Whip and on a motion which will divide the House—on a measure initially thought to be non-controversial. Something went badly wrong somewhere in the handling of the Bill.
Perhaps the answer to what went wrong can be found in the Opposition motions drawing attention to the lack of consultation by the Government before they introduced the Bill and requiring the Government to concede the idea of a Special Standing Committee. Such a Committee would allow those in Scotland who know about debt problems to come and advise us on further progress of the Bill. The experts entertain a great many anxieties about the effect that it will have on people trapped in debt.
Complaints about the lack of consultation have come from almost everyone concerned with handling debt problems in Scotland. As my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said, complaints have come from citizens advice bureaux, money advice projects, the care in the community Scottish working group, professional bodies involved in insolvency and sequestration—and even from Conservative Back Benchers. The hon. Member for Kincardine and Deeside (Mr. Kynoch) was one of the first in the Scottish Grand Committee to complain about the Government's lack of consultation with the professionals involved in sequestration.
The Secretary of State for Scotland recognised early in his speech that there was a perception of a lack of consultation. Of course, some complaints emanated from quarters that one would expect to complain about a Bill of this kind. I remind the House that we were told at first that this was a Bill that would end the public scandal of fat cat accountants ripping off the public purse. I have with me a copy of the front page of the Daily Record of 4 June, fortuitously timed to coincide with the first sitting of the Scottish Grand Committee. The headline that day was, "Making millions out of misery".
The story went on to describe why there was all-party support for the measure. Labour Members told the Daily Record that one firm was raking in more than £3 million a year in fees under the present arrangements. Neither the firm in question nor the Labour Members were mentioned by name in the article, although it would seem from what my hon. Friend the Member for Garscadden said today that he was one of the Members in question.
We were told in the story that the Scottish National party slammed the system as a gravy train. This being a Government Bill, it was to be expected that Government supporters would support it—although, in the wake of the Danish Maastricht referendum result, we should take nothing for granted when it comes to Government Back

Benchers these days. The story did not mention the Liberal Democrats—they are never mentioned in the Daily Record, so we should not be surprised at that.
The Daily Record was in no doubt about who the real villains of the piece were:
The men in grey suits are cashing in on a Government scheme to privatise the bankruptcy business. And their bumper fees—nearly £20 million … a year—are passed on to the … taxpayer.
I do not know where the Daily Record got the idea that this is a Government scheme to privatise the bankruptcy business. This Bill will achieve the exact opposite. Perhaps, like everyone else, the paper suffered from a lack of consultation. The Murdoch press got it right; it labelled the measure a Tory nationalisation Bill. Perhaps the Murdoch press was the only body to be consulted about the Bill before it was introduced to the House.
Nevertheless, given the public scandal outlined by the Daily Record and given the alleged cross-party support for ending that scandal by means of the Bill, it might be expected that the Bill would receive a fair wind on Second Reading and would not receive any opposition except, perhaps, from the fat cat accountants whose firms are allegedly feathering their nests to the tune of £3 million a year in some cases. However, that is not what has happened. Complaints have been pouring in from many sources and from almost everyone involved in handling debt problems in Scotland.
There have been complaints about lack of consultation to which reference has been made during our debate. The Bill has been banged together by Scottish Office civil servants and Ministers working together in splendid isolation. They have talked to no one about the Bill. They have sought no advice and they have consulted no one. They have simply tried to slip the Bill quietly through the House in the hope that the Opposition were looking in the other direction.
Fortunately, the Government have not been able to get away with that strategy. Progress on the Bill was delayed in the Scottish Grand Committee, and the Committee was forced to meet a second time. My hon. Friends have tabled a motion which has allowed us to debate the matter today. In that sense, time has been bought and people with legitimate concerns will be able to lobby hon. Members on their misgivings about the impact of the Bill on people affected by debt in Scotland.
Groups like Tackling Debt in Castlemilk, to which reference has already been made, have warned in letters that they have sent to most hon. Members that consumers and debtors will be denied access to bankruptcy procedures if the Bill is passed without amendment. They believe that as it stands, the Bill will mean that debtors cannot get out of difficulties in some cases. They also believe that debtors will have to find legal fees to petition the court for their own sequestration and that bankruptcy procedures will no longer be available to debtors who have little or no assets. Those are the views of groups much closer to the reality of handling debt problems than any hon. Member. We should pay attention to those views in the way suggested by the Opposition motion.
The Scottish Consumer Council has described itself as having a particular responsibility for disadvantaged and inarticulate consumers. It has pointed out that the right of debtors to petition for their own sequestration will require legal knowledge and the payment of legal fees, both of which requirements tend to render the new right as


nothing other than a paper right, something which cannot be put into effect in the real world. Debtors may be entitled to that right, but in practical terms, they will not have access to it.
The Minister will try to persude us that we can deal with those problems in Committee. In the Scottish Grand Committee, the hon. and learned Member for Fife, North-East (Mr. Campbell) pressed the Minister on whether the Government would be willing
to consider circumstances in which there will he no financial bar to persons … getting advice"—
and the right to institute legal proceedings at public expense. The Minister simply replied:
we shall consider those matters in detail in the Standing Committee."—[Official Report, Scottish Grand Committee, 8 June 1992; c. 57-8.]

Mr. Allan Stewart: I actually said that I assured the Committee
that straitened financial circumstances will not be a barrier to sequestration.

Mr. McAllion: The Minister actually said:
I reassure him that the Government's purpose is that straitened financial circumstances will not be a barrier to sequestration."—[Official Report, Scottish Grand Committee, 8 June 1992; c. 58.]
If the Minister had listened to the argument as I tried to develop it, he would understand that I was arguing that the Government's purpose is to cut public expenditure on bankruptcy. If they are successful in that, the by-product will be that people will not be able to have access to legal advice because of straitened financial circumstances.

Mr. Stewart: I have great respect for the hon. Gentleman, but I am surprised that after all this time he does not appear to have read my speech. I stated clearly:
The savings and expenditure on sequestrations will be achieved through tighter control over the fees paid to insolvency practitioners and through the introduction of simpler procedures in small asset cases."—[Official Report, Scottish Grand Committee, 8 June 1992; c. 56.]
My right hon. Friend the Secretary of State repeated that point when he opened the debate.

Mr. McAllion: I listened carefully to the Minister and the Secretary of State, and I have read the Minister's speech. I will deal with their claims later because I do not believe that they can deliver the kind of protection promised in the Bill. That will not matter once the Bill has passed through the House, because nothing can then be done to retrieve the situation.
I have been dealing with Tory Governments in the House for five years. I have learnt not to trust Tory Governments and especially not to trust the Parliamentary Under-Secretary of State for Scotland, the hon. Member for Eastwood (Mr. Stewart) when they make commitments about political issues. The Minister's policies are completely opposed to the best interests of the people I represent in the House.

Mr. Allan Stewart: rose—

Mr. McAllion: If the Minister is about to ask me to recount an instance when he misled the House and the people of Scotland, I will do that right now: the poll tax. The Minister was one of the most vociferous supporters of the poll tax throughout the last Parliament. However, he then stood on his head and said that he no longer

supported it. He said that he supported the new council tax because the poll tax had been the disaster that we said it was going to be throughout the last Parliament when—

Mr. Deputy Speaker (Mr. Geoffrey Lofthouse): Order. The hon. Gentleman should withdraw the word "misled".

Mr. McAllion: The Minister certainly gave an impression about something that was not true. Whether he deliberately misled the House, he painted a picture that could not be delivered in the real world outside the fantasy world in this place.
The trouble with dealing with issues in Standing Committee, even in respect of a Scottish Standing Committee when there must be no fewer than 16 hon. Members from Scottish constituencies on the Committee, is that there will be a Government majority in the Committee as a result of the addition of English Members to the Committee or by keeping Opposition Members off it. In other words, the minority party in Scotland—the Conservative party—will be able to create an artificial majority on a Standing Committee dealing with a Bill on matters that relate exclisively to Scotland.
I do not doubt the Minister for a moment when he says that he will consider just about anything in Committee. I am sure that he might even consider the possibility of establishing a socialist republic in Scotland, but that does not mean that he will concede it in the Standing Committee. He will consider any of our suggestions in Committee, but he will use the Government's inbuilt majority not to give concessions to the Opposition. That has always been my experience of Standing Committees under the Tory Government. They listen, but they never hear what is said. They have no intention of honouring the commitments they give in Second Reading debates.
At the heart of the Bill is the Government's determination to cut public spending on bankruptcy procedures. The Secretary of State described how the costs are spiralling out of control. He said that the costs were £20 million last year; that they would be £50 million in 1993–94 and £80 million in 1994–95. He even identified the source of those spiralling costs as he did in the Scottish Grand Committee. He said that the source was the changing rate or pattern of sequestrations since the introduction of the Bankruptcy (Scotland) Act 1985.
Initially sequestrations were seen as a means whereby debtors' assets could be realised and the proceeds divided fairly between the creditors, the 1985 Act changed all that according to the Secretary of State. In 1986–87, 75 per cent. of the total of 437 sequestrations were creditor driven and came before the courts because the creditors asked for that to happen, in 1991–92, 87 per cent. of 8,500 sequestrations arose through the procedure which allowed debtors to appoint insolvency practitioners as trustees to petition the courts on their behalf.
In those cases, the funding came directly from the public purse. Millions of pounds of public money will be saved only if debtors are denied access to bankruptcy procedures that are currently available to them. If those debtors have to be guaranteed continuing access to bankruptcy procedures under a different form, it is difficult to see how the savings in public expenditure can be achieved.
If the Minister argues that, in an average sequestration, 89 per cent. of the cost of the work arises from what he describes as junior administrative grades and that that


work can be handled more efficiently and more cost-effectively in the public sector than in the private sector, that argument delights me. Of course, the Minister himself is one of the great apostles of free enterprise, and he does not really believe that argument.
The Secretary of State said that the Government are taking the process back into the public sector so that they can then use market testing to put it back into the private sector. Their case is that they can make savings by putting the process into the public sector and make even more savings by putting it back into the private sector. That makes nonsense of the Government's arguments in support of the measure.
The Minister knows that, if cash is to be saved, access to bankruptcy procedures must be limited to people with debt problems. That is why I continue to oppose the measure and why I shall support the motion. There must be a Special Standing Committee. The majority of hon. Members who vote tonight will not have read the 1985 Act and will not know what issues are involved in the Bill. They will simply vote on party lines on issues that they know nothing about.
This is an important measure, which will have a real effect on real people in Scotland. For their sake, it is absolutely essential that every Scottish Member fully understands exactly what is involved in the change that will be brought about by the Bill. None of us is an expert in the matter, although some hon. Members have legal backgrounds. The real experts are in Scottish communities, working for money-advice projects, citizens advice bureaux, legal firms, accountants and so on. We need to hear from them what the implications of the measure are. Therefore, it is absolutely essential that there is a Special Standing Committee. If the Government are not prepared to concede that, it is because they are not prepared to have their Bill exposed to expert scrutiny. That is all the more reason why the Government have no right to proceed with the Bill.

Mr. Phil Gallie: It absolutely amazes me that Opposition Members feel that the Bill should go to yet another Committee, particularly as they say that they agree with its contents. Perhaps that is simply a means of inducing an argument. To date, we have had two Scottish Grand Committee sittings; today we are having the Second Reading debate, and the Bill will then be committed to a Standing Committee. At that point we will go into the detail of the Bill.
There has been a massive escalation in costs, from £13,000 five years ago to £18.5 million today. Surely there is something wrong. Surely we need to act swiftly. If we look to the future, we see escalating costs. I do not know what Opposition Members think, but money wasted on administration—that is what much of the money represents—could be better spent in my constituency. I look to the Government to do that as swiftly as possible, and I look to Opposition Members to back them.

Mrs. Ewing: The hon. Gentleman may not be aware of the background of the legislation, but, several years ago, there were cries and calls from Opposition parties for an investigation into the matter, which could have saved £12 million to £15 million. If the Government had acted more

expeditiously, that money could have been saved and spent on better prospects. The legislation does not take account of all elements of bankruptcy law. It is almost a misnomer of a Bill, as bankruptcy is mentioned only in the title. We have not examined the regulations or other aspects to ensure that we have an effective system of sequestration in Scotland, enabling access at reasonable cost.

Mr. Gallie: I thank the hon. Lady for her intervention. The Bill addresses real problems. The Government have examined it in detail, and many items in the Bill will assist better administration in future. The matter is urgent and I certainly support the Government.
I deplore the attitude of Opposition Members who complain about lack of time to debate the issues. The Scottish Grand Committee lost 45 minutes on absolute nonsense and protests about issues that have nothing to do with the Bill. The hon. Member for Dundee, East (Mr. McAllion) said that my hon. Friend the Member for Tayside, North (Mr. Walker) took 22 minutes to debate the issues in the Bill, yet the hon. Gentleman was involved in wasting those 45 minutes in Committee. I ask right hon. and hon. Members to bear that point in mind.
There is much talk about consultation with other quarters. The hon. Member for Glasgow, Garscadden (Mr. Dewar) listed several contacts. He talked about the Institute of Chartered Accountants of Scotland, local accountants, Drumchapel law centre, citizens advice bureaux and money advice centres. He omitted the Scottish Consumer Council. That organisation took account of creditors. I am surprised that the hon. Gentleman omitted it. Perhaps he would like to comment on that. [HON. MEMBERS: "Why?"] Because three parties are interested in the Bill. There are the creditors, who are important; the accountants, who certainly have an interest and have operated in such matters in recent years, and, most important, the individuals and companies which are in deep trouble. In Committee, creditors were ignored by Opposition Members.

Mr. Dewar: At the great danger of extending the hon. Gentleman's speech, may I ask him to comment on the views of the Scottish Consumer Council? The hon. Gentleman will remember that it said:
We support the Bill's primary purpose.
It went on to say:
We are extremely doubtful that individual debtors will feel competent to petition the court without any form of assistance.
The council went on to say that the system was wrong and gave three specific, fundamental ways in which it should be changed and which the Government are resisting. The council said:
We are very disappointed that there has been no prior consultation.
The Scottish Consumer Council has great sympathy with my point of view.

Mr. Gallie: I have taken much time to examine all the consultations in detail. Further, I have met representatives. [Laughter.] Perhaps it is hilarious to the hon. Member for Garscadden that Conservative Members take time to talk to those bodies. I have taken time to talk to the Scottish Consumer Council. I have also taken time to talk to accountants and advisory bodies. I recognise the points that they have raised and I am prepared to take them on


board. I am quite sure that the Government have also taken them on board. The place to consider them in detail is in Committee.

Mr. Wilson: We must get to the bottom of this. The hon. Gentleman prayed in aid the Scottish Consumer Council and said that it was concerned about creditors. I am sure that it is—we all are—and that is perfectly right. However, in addition to what my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said, the Scottish Consumer Council said:
Our concern is to ensure that the benefits to consumer debtors introduced with the 1985 Act are not lost in the process of this Bill.
Does the hon. Gentleman share that concern?

Mr. Gallie: Of course I share that concern. I have borne it very much in mind. The Bill provides protection. 1 do not necessarily agree with every issue that has been raised. Conflicting views have been put forward. I acknowledge that. I will make my judgment, and no doubt other hon. Members will also do so.
I return to the Bill. The Bankruptcy (Scotland) Act 1985 was designed to help people who had reached a state of personal and financial crisis. I wish to concentrate on low assets cases. From 1985 onwards, the Act provided a great deal of protection for debtors from debt collectors, sheriff officers and institutions. It took constant pressure off them. As I said in the Scottish Grand Committee, it was a caring Act. For many people there seemed to be no way out. The 1985 Act gave them some light at the end of the tunnel.
However, sequestration is all too often taken up as an easy option, as I said in the Grand Committee. I was told that I was insensitive in doing so. Perhaps the tears trickle down the cheeks of Opposition Members when they look at things in realistic terms. But my heart goes out to the many small businesses and self-employed people who have extended credit terms in good faith. One of the consequences of too easy recourse to sequestration is bankruptcy and loss of jobs for others. We must take that on board. There is a snowball effect. We seek protection for individuals. We need protection all round.
As my hon. Friend the Member for Tayside, North said, all too often people are pushed into bankruptcy without giving due consideration to what it means for the future. Once they have signed on the line with an insolvency practitioner, there is no way back. There is no pause for reflection. There is no chance of changing their mind. People often do not realise that bankruptcy means that for them credit will not be an option for the next 15 years. That can be important to young people who want to set up home. It can be important to people at large. We must bear that in mind. I suggest that, as we have done in other legislation, we could inject some form of cooling-off period into the Bill. I ask my hon. Friend the Under-Secretary to consider that.
What of the private insolvency practitioners? They have come in for some stick today. In many cases, these people do an excellent job. In most cases they certainly treat in a sympathetic manner the issues and the people with whom they are dealing. But others have a business approach. The current legislation offers practitioners easy access to considerable rewards. In the Scottish Grand Committee I was delighted to hear my hon. Friend the Minister say that he would examine that point.
The fact that a practitioner can pick up £2,300 to clear a debt of £750 is a bad deal for everyone—for the individual and certainly for the taxpayer. The accountancy profession recognises that there is a need for change. It has suggested that an element of self-regulation is possible. I believe that the industry is capable of achieving that and that it is sufficiently responsible to do so. However, there must be a major change in the fee structure.
Opposition Members have made comments about nationalising insolvency practice. The hon. Member for Garscadden seems to have been converted on the way to the polling booth to the benefits of privatisation. I welcomed his comments about nationalisation of the bankruptcy procedure. But I also welcomed the words of my right hon. Friend the Secretary of State, who suggested that the private practitioners had a part to play. That is an important point and I await further developments with interest.
The hon. Member for Garscadden referred briefly to non-payers of the community charge. It is unacceptable to me that scroungers, the deliberate non-payers of the community charge who have incurred debts of £750, can look to the insolvency procedure for a way out at the expense of the taxpayer. I ask my hon. Friend the Under-Secretary to consider that point.
At the beginning of my speech, I made the observation that much of the cash currently spent on the insolvency procedure was being wasted on administration and unnecessary involvement without practical achievement. Much of that money would be welcome in my constituency. I take this opportunity to underline that if some saving can be made on administration costs in whatever way—I do not take a dogmatic approach in the argument between privatisation and nationalisation—I would like that money, all of which comes out of the same budget, to be pushed into improving the infrastructure in Ayrshire and especially into upgrading the A70 to trunk road status.
The Bill seeks to simplify the present system. It will inject a pause for reflection. It will save wasted resource. I look forward to its early implementation.

Mr. James Wallace: In the Scottish Grand Committee, the hon. Member for Ayr (Mr. Gallie) spoke with exemplary brevity because of time pressure. This evening, for the first time in a Scottish debate on the Floor of the House, we have had an opportunity to hear him speak at greater length. It is clear to Opposition Members that his speeches share many of the distinctive features that we have come to associate with those of the hon. Member for Tayside, North (Mr. Walker).
Both hon. Gentlemen made reference to the appalling position of those who get into debt. It is widely agreed on both sides of the House that those faced with the pressures and anxiety of debt are in an appalling position. However, one is entitled to ask under which Government and what philosophy and attitude were so many people pushed into acquiring more and more material possessions? Which Government made credit all the easier to obtain? Now many people suffer the consequences, which affect not only them but their families.
As I did in the Grand Committee, I immediately declare an interest. I am a parliamentary adviser to the Institute of


Chartered Accountants of Scotland. As has already been said, the institute has written a letter to the Minister of State, Lord Fraser, stating how it sees the way forward and making suggestions.
Many of us who heard the Secretary of State try to give some semblance of having consulted on the Bill noted that almost all the consultation took place after the Bill was published. I support the case for a Special Standing Committee for several reasons which I shall give in a moment. However, I wish to say at the outset that if there was ever an argument for a Scottish Parliament to deal with Scottish affairs, the way in which the Bill has been dealt with is it.
There have been two sessions in the Scottish Grand Committee and today's debate. Those hon. Members who support the idea of a Scottish Parliament have never believed that we should adopt Westminster procedures lock, stock and barrel. The procedures in this place are so archaic and hostile to the proper consideration of technical measures such as the Bill, that one would hope that with an opportunity to start afresh, one could do it properly. We advocate pre-legislative committees, which could examine such issues and consider the views of accountants and of the many other organisations which have written to us to explain their worries about this legislation.
The hon. Member for Dundee, East (Mr. McAllion), talking about how the Bill was drawn up and launched on an unsuspecting public and profession, caused me to wonder whether the Government involved anyone with practical experience of insolvency proceedings in the drafting of the Bill. I must confess that, for three or four years, I tutored in conveyancing at Edinburgh university, without having carried out a practical conveyance. There are obvious drawbacks to that, as we arc now realising.
So much could be done to improve this legislation with input from people with first-hand, practical experience. We could achieve the Government's objective. It is accepted on both sides of the House that there should be a means for people who get into debt to have access to the courts, to undergo the sequestration process—that process takes a long time—and to start anew. Creditors' interests should be properly looked after, as should the interests of the state and the taxpayer, by ensuring value for money. Those objectives are widely shared.
The present opportunity for comment makes us realise what could have been done at an earlier stage if the Government had consulted. The Bill should go to a Special Standing Committee, which would allow the Government to respond properly to the proposals by the Institute of Chartered Accountants of Scotland. The Secretary of State said that they would be considered with interest, but it is of fundamental importance for the House to know the Government's response before we deal with the Bill, line by line and clause by clause.
The question of debtors' access to sequestration procedures has been mentioned. I accept what the Under-Secretary of State said in Committee, in response to my hon. and learned Friend the Member for Fife, North-East (Mr. Campbell), and what the Secretary of State said today about it not being the Government's intention, in proceeding with the legislation, to put up

barriers that do not exist. However, whatever their intention, many organisations that have written to us are justifiably concerned that there are such barriers.
In the Scottish Grand Committee, the Minister referred to advice by way of representation. A letter, which I and no doubt all my colleagues have received, from Drumchapel law centre encloses
a further Briefing Note on the Bill
on behalf of the "Tackling Debt Group", which referred to the fact that the group had expressed concern about
Advice By Way of Representation",
because there is
necessity of a means test—with no scope for taking debts into account".
which might make some people ineligible and, that "limited circumstances" are "presently available" for
clients incapable of self-representation through eg language difficulty.
Whatever the intention behind the Bill, there is concern about other procedures—not necessarily those outlined in the Bill—for example, the legal aid regulations, and concern that the position is not as the Government intend. We have also received representations from Money Advice Scotland, which pointed out:
The concurrence of a creditor in any small assets petition is extremely unlikely
and which believes that some of the procedures and requirements in the legislation might also put up barriers. I accept that that might not be intended, but it might well be a consequence of the Bill.
We must properly examine the Institute of Chartered Accountants' proposals and analyse some of the serious worries expressed by people who have to deal with debtors daily, and who feel that the Bill will block a route which is now open to them, or at least put a high barrier in their way. There is no challenge to the objectives of the legislation and there would not be the sort of partisan approach that might colour a Special Standing Committee considering a more contentious piece of legislation.
I must refer to the proposals submitted by the Institute of Chartered Accountants of Scotland to the noble and learned Lord Fraser, for example in relation to cases where there are assets—non-schedule 2 cases. We heard a welcome repetition of the assurance given to me and to the hon. Member for Kincardine and Deeside (Mr. Kynoch) in the Scottish Grand Committee, that the Government would undoubtedly reconsider the matter.
The institute also suggests that there should be a switch in onus. Rather than the debtor having to acquire the consent of two thirds of the creditors, one third should have to object to prevent protected trust deed status, as sequestration might thus be avoided, which would further reduce any call on the public purse.
I understand that, in about 80 per cent. of all cases, there arc no assets. The summary administration procedure is a welcome feature of the Bill, and it has been estimated that it might cost a fee of about £800 plus outlays. which is a considerable saving on the amounts being discussed. We need some inkling of the Government's response to that proposal, because it totally shifts the background against which the Bill is being discussed.
As another practical means to save money, it has been suggested that the accountant in bankruptcy should merely audit a sample of cases. There should be proper discussion of whether that would offer an adequate safeguard, where public money is involved.


The institute also discusses what it describes as "small asset" procedure—cases where assets are not sizeable but where a business is involved and the work will thus not be straightforward, rather than cases of consumer debt. It is suggested that the interim trustee would act, the present block fee of £2,000 would apply, and it would be up to the trustee to submit to the accountant in bankruptcy that that was the proper way to proceed. The accountant could countermand that if he thought that the case should proceed by way of summary administration.
That would reverse what is likely to happen under the Government's proposals, when the first step in what might well be a more than usually complicated procedure would be to apply to the accountant in bankruptcy who, recognising that the case would be more than run-of-the-mill procedure, would use the powers given to him under the Bill to farm it out to a practitioner at a fee. That would involve an important loss of time and unnecessary duplication of effort. If the insolvency practitioner acts as the interim trustee—subject to the accountant in bankruptcy saying that that was not appropriate and that the case should proceed to summary administration—the safeguards would still exist, but some of the other qualities of the present system could remain.
It is worth considering whether the debt threshold of £750 might be increased. A figure of £1,500 has been mentioned. That might need to be increased by order to keep pace with inflation. The summary administration also puts a limit on liabilities, which must be less than £20,000. If the process is triggered off by a lack or a negligible amount of assets, the size of the liabilities hardly matters.
However, it would be a matter of public interest if someone had managed to build up liabilities of £100,000 or £200,000 on the basis of assets of, for examle, £2,000. In such a case, something would have gone very wrong and that would require further investigation. I do not believe that we need to stick to a figure of below £20,000. I have outlined some practical proposals, which could lead to a reduction in costs and achieve one of the objectives upon which all hon. Members are agreed.
I listened to what the Secretary of State said about maintaining the local network, which is important. Since the debate in the Scottish Grand Committee, I have received further correspondence from the citizens advice bureau in Shetland, which has just been established. It emphasises the importance of quick and ready access to an insolvency practitioner. Most of those serving the Shetlands come from Aberdeen and they manage to provide a quick response because of the good connections between the two. One firm of insolvency practitioners has already been mentioned in the debate and, in all fairness, I should add that the citizens advice bureau in Shetland has no complaints whatsoever about the quality of its service.
It is assumed that, if someone approaches an insolvency practitioner, a sequestration will automatically follow. I made the point in the Scottish Grand Committee that when the insolvency practitioner is given the opportunity to analyse a person's situation, assets and liabilities, a course of action, other than sequestration, may well be counselled. In response to my intervention, the Secretary of State confirmed that other such courses would not be possible under the Bill. Once one approaches the accountant in bankruptcy, that is that. In the past, one depended on seeking advice from bodies such as citizens

advice bureaux or other advisers on money. In many parts of the country, the citizens advice bureaux and other money counselling services are not readily available. That is a serious gap. Under the Bill, the Government may push people into sequestration who might not otherwise choose that option.
It is important not to overlook the personal dimension. The letter that I received from the Shetland's citizens advice bureau states:
Here the personal relationship between the debtor and his trustee is invaluable, hence why we always recommend insolvency practitioners who regularly visit the island. This relationship provides a source of security and benefit for all concerned, debtor, trustee and creditor. I doubt that it will exist when the work is taken over by a government department, the public already see these as impersonal.
We are considering people who are in dire straits, with very serious personal problems. We cannot put a monetary value on a personal relationship such as the Shetland citizens advice bureau described, but I fear that it might be lost.

Mr. Wilson: Does the hon. Gentleman agree that the statistics, which give the breakdown by court area, support his case? Last year, in Lerwick sheriff court, there were 16 sequestrations. That hardly suggests a rush for the "easy option" as has been suggested by some Conservative Members.

Mr. Wallace: The hon. Gentleman has the advantage of having a copy of the detailed breakdown, but the point is well made.

Mr. Gallie: rose—

Mr. Wallace: I shall not give way, as I want to conclude.
Sufficient arguments were made in the debate in the Scottish Grand Committee and have been made in this debate to suggest that the matter needs proper re-examination. As I told the Secretary of State, it is unlikely, given the timing of next week's meeting of the Select Committee on Selection and the fact that the Standing Committee—or better still a Special Standing Committee—will be unable to sit until 30 June at the earliest, that the Bill will finish its Committee stage before the recess. Therefore, the Government should turn "homeward and think again".

Mr. Michael Connarty: I do not intend to rehearse the arguments that I made at some length in the Scottish Grand Committee. I shall confine my remarks to the motion.
I admit to being a sceptic by persuasion, but I was drawn into suspending my normal suspicion by the Government's offers—unlike my hon. Friend the Member for Dundee, East (Mr. McAllion), who may have more experience of the Government. The Parliamentary Under-Secretary of State for Scotland, the hon. Member for Eastwood (Mr. Stewart), offered conciliation and even co-operation, which was very impressive. There was even a search for an understanding of the plight of persons forced into bankruptcy rather than a scurry by the Government to take back moneys from the private sector.
I was particularly impressed by the nods and smiles of the Parliamentary Under-Secretary of State for Scotland, the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton), when the arguments for such


understanding were made. I now realise that he and his hon. Friend were squaddies, or, rather, non-commissioned officers, on the loose and that the sergeant major was on another exercise. He has now returned. The Government's normal dismissive approach to Scottish matters has been reasserted by their refusal to set up a Special Standing Committee, which we thought would be forthcoming.
The House must ask what great concession the Government made. Was it that they would provide finances for something in Scotland or that they would concede the power to make decisions on the Bill to the majority of Scottish Members? The great concession that they nodded at and hinted at, but which they would not dare promise, was that they would listen to those in Scotland who were concerned about the Bill. I know that most Scots do not believe that. My hon. Friend the Member for Dundee, East stressed the fact that they, and I, would have been wrong to believe it. Given the Government's breach of faith—the fact that a Special Standing Committee will not be established and will not hear evidence—Labour Members were forced to ensure that this debate took place.
Why will the Government not listen? Are they afraid of what they might have heard from those who would have presented evidence to a Special Standing Committee? I had hoped to hear from the accountants rather than from the hon. Member for Orkney and Shetland (Mr. Wallace), who nevertheless did a splendid job on their behalf. I would have liked the accountants to explain how they discovered the sudden economies that allowed them to offer a cheaper deal.
I must tell the hon. Member for Ayr (Mr. Gallie) that the moneys to which he referred went, not into administration, but into profits. As the hon. Member for Moray (Mrs. Ewing) pointed out, on a time-and-line basis, each case could have been dealt with for £500 when the standing charge was £2,140. The argument about the fees charged was not about administration but about profit.
I would be interested to hear the views of someone who can calculate, unlike the civil servants who put together the financial memorandum for the Bankruptcy (Scotland) Act 1985 and for the Bill. I would like to know how many cases one would reasonably expect to deal with between 1993 and 1995, given the present economic environment and the free and easy credit regime initiated by the Government.

Mr. Gallie: The hon. Gentleman has referred to civil servants' belief that, without the Bill, costs would escalate. May I draw his attention to the intervention of the hon. Member for Cunninghame, North (Mr. Wilson), who pointed out that relatively few cases had passed through Lerwick sheriff court? Surely that gives substance to the estimates made by civil servants.

Mr. Connarty: It probably says a great deal about frugality and the way in which people run their affairs in Lerwick rather than the Government's economic policies.
I would have been interested in the accountants' view of how many cases could be processed, if the estimate contained in the financial memorandum of a cut of between 75 and 80 per cent. in expenditure had been realised. The memorandum states:
It is estimated that some 75-80 per cent. of the projected expenditure required to operate the present arrangements can be saved as a consequence of implementing the Bill.

I do not see how that can happen unless far fewer cases go through than at present, not to mention the estimates of the number of cases in the future.
Accountants may have been tempted to give the view on the relative scale of their largesse of £18.5 million compared with other well-known transfers of profit-making enterprises to the private sector, such as British Telecom, British Gas and the electricity and water undertakings to name but a few. I am sure that those accountants do not consider their largesse to be very grand compared with the £95-a-second profits of BT.
I hoped to have heard from the debtors, possibly through those to whom they turn when in despair. I have heard many disturbing comments today about debtors taking on credit which they cannot afford and not being frugal enough.
For example, a client of a money adviser—a 19-year-old pregnant girl living in bed-and-breakfast accommodation—had lost her job and was no longer living at home, having fallen out with her parents. Where did she accrue most of her debt? She had bank loans of £1,200, £1,100 and £1,000. Amost 60 per cent. of her debts were made up of bank loans. That has little to do with trade; it has more to do with how people who obviously do not have sufficient income to repay the debt are pushed, egged and encouraged into debt by what should he responsible institutions. That better shows the meaning of a "debtor" than those who take on debts which they do not intend to repay.

Mr. Gale: Will the hon. Gentleman give way?

Mr. Connarty: No. We have all heard enough from the hon. Member for Ayr for the moment.
I should like to have heard about the paralysis of debt and poverty. I have heard much about that in talking to people who deal with the problem. It makes petitioning on a personal basis terrifying for many people who are in the depths of poverty and debt. It is terrifying to many and a barrier to most. We need clear amendments to the legal aid rules to assure everyone that, when people wish to present a petition, they do not find themselves facing further financial barriers. We have heard assurances from the Government on that, but I want the Secretary of State to show that my hon. Friend the Member for Dundee, East (Mr. McAllion) was wrong to be sceptical, and that he will produce a solution to that problem faced by many people.
I wanted to hear more about the process through which people go. There is much talk about people being rushed into bankruptcy to get out of debt easily. Someone who deals with that matter advises me that the present procedure is extremely thorough. When a client asks such an organisation for help, his financial situation is studied closely. His income is maximised by checking on his entitlement to rebates, and creditors are contacted to explain the clients' position and requesting them to freeze interest payments accruing on accounts. Much work goes into trying to stop people entering the bankruptcy procedure. I have no evidence that people rush into it, as Conservative Members have been hinting.
The Government's approach suggests that bankruptcy is an option—but only after a long process. I wanted to hear about that process and to see some sensitivity toward it in the Bill. I also wanted to hear about the beneficial actions of the permanent trustees to ensure that those arc not denied to people. According to my reading, they are


certainly beneficial. I accept and have stressed that it is an expensive process. Indeed, I used the word "greed" when I spoke in the Scottish Grand Committee. That may have been too strong a term, but if costs can be cut by 50 or 60 per cent. in a couple of weeks, super-normal profits were being made and there might have been an element of greed.
Creditor pressure could be stopped, not only on the debtor but on his family, because it is distressing, frightening and crippling. The trustee could stop the recalibration of power meters, when people pay so much per unit for their power that they can never get out of debt, tackle their futures and put their lives in order. People with social fund repayments to make could have those repayments stopped to allow them a breather to try to sort themselves out. That is what credit, bankruptcy and sequestration were all about and that is what the Government said that they were about in 1985. We must ensure that those measures are still available to alleviate those pressures, even though people may not have the same automatic right to go to a permanent trustee.
It is important that the Bill should respond to people's fears. If we create more fear, we shall do an injustice to the people of Scotland. The fears of the organisations that represent debtors must be taken on board. Most of them have been mentioned before, but I shall mention some again. The charge for lodging a petition must be dealt with. Would the accountant in bankruptcy deal with problem creditors? Would he give the protection which the permanent trustee gives? Would the limited assets or summary procedure be introduced, as the Government say? Would not it be so complicated that people would have to go to another agency for help? I should have liked to have heard people speak about those problems, and that is why a Special Standing Committee was so important.
I wanted to hear from organisations that supported the prime purpose of the Bill. Some have been mentioned, but I refer particularly to the Scottish Consumer Council, which, although it supported the Bill, had serious reservations about it. It said:
We are extremely doubtful that individual debtors will feel competent to petition the court without any form of assistance 2026; it would be difficult for a debtor to present a petition in the correct form.
It went on to make sensible suggestions about simple forms of petition and said that the technicalities of the reference to protected trust deeds should be deleted so that the debtor could petition without a qualified creditor moving against him. There should then be an agreement that no costs would be incurred in the courts in the sequestration process. It is important that we hear from those people but the Government have denied us that opportunity.
We need to undertake a process of discussion and education, rather than just replying to people's questions and amending the Bill in a minor way. We need to enter a process of construction and, hopefully, reconstruction of the 1985 Act, not just to answer those simple questions but to give Scotland a legal process that will allow people to free themselves from the crippling spiral of debt. A Special Standing Committee would have given us that opportunity, which is why we are debating the matter tonight. Are the Government really saying that civil servants or Ministers alone can work out the results of legal procedures? The effects of the 1985 Act show that that is an untenable argument and it is unlikely that, if done alone, it will be done properly.
Are the Government also saying—it would appear that they are—that they accept that only Opposition Members will act as ciphers for the concerns, questions and suggestions of the socially sensitive organisations in Scotland? Again, that is what they appear to be saying in denying the setting up of a Special Standing Committee.
It is important that we get around the table in a dialogue with the people who are trying to put submissions to us—accountants, consumers' organisations and debt counselling organisations—and work out a strategy sensibly and thoroughly. The present method may place us in a more defensive and protagonist position because of the Government's decision on the Special Standing Committee. I invite the Secretary of State and his junior Ministers to review their position and to help the Opposition to achieve what we thought was promised in the Scottish Grand Committee—the optimum result for debtors and creditors in Scotland.

Mrs. Margaret Ewing: The Secretary of State spoke of the widespread harmony for a change in the bankruptcy law in Scotland. Speeches from the two sides of the House have shown that there is harmony on that general principle. However, I wish to look at the underpinning issues because, if we are to talk about harmony, we should seek to achieve changes to the law that would have the full support of the community in Scotland. It is clear from the representations that have been made prior to the debate in the Scottish Grand Committee and since then that that harmony does not exist in Scotland.
The Secretary of State also said that the legislation was being introduced as a result of the monitoring of the workings of the 1985 bankruptcy legislation. That is a slightly ingenuous interpretation to put on the Bill because the workings of the 1985 Act were not constantly monitored. The Department of Trade and Industry instituted not monitoring but evaluation processes in 1990, subsequent to questions that I asked in the House. So there was not consistent monitoring of the workings of that Act until that stage. That should be clearly recorded in our deliberations.
We all welcomed the issue of access which was dealt with in the 1985 Act and we want that issue to be retained in this legislation. But if we are to move forward, we should ensure that the changes that we make are effective and will work on behalf of all the people of Scotland.
There is no confidence north of the border that the Bill will resolve the problem of excessive cost, which is the essential trigger mechanism that has set this legislation in train. The Bill is, in effect, nationalisation, although the Minister hates to use that word. Alternative ways of saving money have been offered to him. In the Scottish Grand Committee, I suggested taking a time-and-line attitude similar to that of the legal aid provision of advice and assistance. He appeared to reject that idea, saying that the legislation had to be on the statute book before he could consider such issues. I find his attitude difficult to understand, as the Institute of Chartered Accountants of Scotland has made alternative proposals. Is the Minister saying that the legislation has to be on the statute book before the institute's suggestions can be implemented or even considered?

Mr. Allan Stewart: I was saying that the present agreement between the institute and the accountant in bankruptcy is voluntary. The Bill gives the Secretary of State powers relating to the setting of fees so that he is in a much stronger position than at present.

Mrs. Ewing: The powers do not need to be contained in legislation such as the Bill but could be introduced via other mechanisms available to the Secretary of State, such as statutory instruments, to provide elements to assist him in altering the present position.

Mr. Stewart: I can assure the hon. Lady that such changes would require primary legislation.

Mrs. Ewing: I am grateful to the Minister for clarifying that. As he knows, I am not a legal expert and I am trying to get to grips with the issue as I have many worries about the legislation.
Is the Minister prepared to take a serious look at the representations that have been made by a variety of organisations to ensure that the primary legislation provides a framework that can be used to develop bankruptcy law and address the problems at the heart of the matter? That case is being put to him firmly by Opposition Members, and I ask him to consider it seriously.
Primary legislation can be amended in future, but we should ensure that any primary legislation that we place on the statute book does not have to be amended time and again to resolve problems that could have been avoided in the first instance.

Mr. Stewart: The short answer to the hon. Lady's question is yes.

Mrs. Ewing: I find that interesting, as the Minister seems to be saying that, if the Government are to take account of the proposals, a large number of Government amendments will be tabled in any Standing Committee that is established to consider the Bill.
Consultation is important because, as a Parliament, we have not addressed the causes of bankruptcy. Hon. Members mentioned the increase in credit. In an article in the business section of The Scotsman yesterday, Gordon Milne expressed his concern at the rise in consumer credit. We should consider the self-employed. It was suggested that the Minister might supply statistics on how many sequestration cases there have been involving the self-employed and small businesses. Such issues have not been addressed, despite requests for investigations into the causes of bankruptcy.
We need an objective appraisal of the costs of sequestration. What skills and expertise are needed? How much time needs to be spent on different cases? We should consider those questions before taking a major step forward.
In an earlier intervention, I mentioned Mark Berman, the only practitioner in debt advice in the Dumfries and Galloway region. I said that some aspects of the Bill would make it much more complicated, at least initially, for people to start sequestration procedures. Other hon. Members have mentioned the fears of individuals—some of which are physical fears. People obviously have mental and emotional worries, but they are also anxious about physical aspects related to warrant sales, with the knock

on the door and all that that implies. Technical amendments contained in the Bill could be introduced immediately, while allowing consultation to take place.
Some of the proposals in schedule 1 are designed to close loopholes that exist in current legislation. Paragraph 16 of schedule 1 amends section 54 of the Bankruptcy (Scotland) Act 1985, which failed to protect the rights of secured creditors such as banks and building societies by preserving their security after the debtor obtained a discharge from bankruptcy at the end of a three-year period. Section 54 needs to be amended quickly, as debtors who are continuing to pay mortgages and rent are threatened by the possibility of eviction under the provisions of the 1985 Act. That is an horrendous position in which to place people who are honestly trying their best to continue payments, despite severe difficulties.
Surely it is not beyond even this Government to consider the possibility of twin-track legislation in Scotland to introduce the Bill's positive proposals, and implement them simply and quickly, while taking the opportunity to look at bankruptcy law in general and ensure that the legislation is effective. If the Government are taking stock, they must bear in mind the Bill's fundamental proposals.
The Scottish National party will support the proposal to set up a Special Standing Committee to consult all the organisations in Scotland involved in bankruptcy. Surely the Minister must have been impressed by the fact that organisations as diverse as the Institute of Chartered Accountants in Scotland, the Law Society of Scotland, the Castlemilk law centre and the Drumchapel debt centre—organisations from different spectrums of society—are as one in asking for further consultations.
A letter from Mark Berman in Dumfries and Galloway states:
There appears to have been a total lack of consultation on this important issue. In February of this year, Money Advice Scotland held a seminar on bankruptcy, at which the keynote speaker was the Accountant in Bankruptcy. At no point did he indicate that such radical changes were imminent.
It is now June and we are talking about radical changes. He continued:
At no point was Money Advice Scotland, Citizens Advice Scotland, The Scottish Federation of Independent Advice Centres, or the Institute of Trading Standards consulted. These are groups that deal with a large number of the 'no asset' sequestrations. There was no need for the secrecy, as all groups could have, and probably would have, been able to make suggestions that would have improved the system without the destruction of a process which has, to this point, shown itself relatively successful.
That organisation works at the sharp end dealing with debtors' problems. It knows better than any hon. Member what it is like to deal with a person who walks through the door with problems on which its representatives have to offer advice. It is on behalf of such people that we make our plea for a consultation process.
It has already been said in today's debate that the time scale involving the Second Reading, the meeting of the Selection Committee and the establishment of a Standing Committee means that there is no opportunity for the Bill to finish its passage through the House of Commons before the summer recess. I have already drafted many amendments and, if I am chosen to serve on the Standing Committee, I shall move them and fight the Bill line by line. I am sure that many hon. Members will do the same.
Why are we Scottish Members not using the weeks before the summer recess to meet organisations to try to


ensure the harmony of which the Secretary of State spoke? There is a Caledonian consensus that we need time to consider the issue. If we want harmony, we should ensure that the voice of those working in the sphere of bankruptcy are heard as the legislation makes its progress.

Mr. Malcolm Chisholm: I am interested in the Bill from the point of view of low-income debtors. I have been influenced by the strongly expressed views of people in the Leith constituency who advise them.
Many such debtors have been dragged unavoidably into the use of expensive credit for everyday living expenses. Some of their debts might be called state sanctioned debts because they pay the price of Government policies, such as the poll tax, social fund repayments and enforced rent increases. Even more fundamentally, it is the Government's failed economic policy that underlies the debt spiral, with still rising unemployment and continuing high interest rates. That, rather than the too easy access to sequestration emphasised by the Secretary of State, explains the rising tide of bankruptcy.
Those in my constituency who give advice and have come to me with their concerns make three points. First, they ask why they, the experts, have not been consulted on the Bill and why it has suddenly appeared from nowhere. I suggest that it is because the Government are not interested in what happens to low-income debtors. Secondly, they tell me that the Bankruptcy (Scotland) Act 1985 is one piece of legislation that works quite well. Indeed, I cannot think of any other legislation in the past 13 years of which that could be said. They tell me that it provides an escape route for low-income debtors. Thirdly, they believe that the purpose of the Bill is to make it more difficult for people to be declared bankrupt and that that is the hidden agenda of the Bill.
Before this debate, there was some evidence for that in the answer that the Under-Secretary of State, the hon. Member for Edinburgh, West (Lord James Douglas-Hamilton), gave on 16 March about there being too easy access to sequestration. In the Scottish Grand Committee the Under-Secretary of State, the hon. Member for Eastwood (Mr. Stewart), suggested the same when he said that the 1985 Act was designed for trading concerns and that too many people were using it for the wrong purpose. Finally, today the cat was let out of the bag by the Secretary of State. The first 10 minutes of his speech were all to the effect that far too many people were using the sequestration procedures. Therefore, the open agenda of the Bill is to cut down on the number of people who gain access to sequestration.
There are three particular concerns. The first is to do with money, the second with accessibility and the third with counselling. Clause 6 provides that money must be paid by someone seeking sequestration through a petition in court. Clause 8 talks of fees being paid to the accountant in bankruptcy. Some of that has been explained in terms of legal aid for poor people. We are told that legal aid will be available, but there is nothing in the Bill about that. Before 1985, legal aid was not available to people seeking sequestration. Even if legal aid is made available, there will be delays, many law firms will not take legal aid work and many people will be excluded from it.
On accessibility, I am sure that everybody in Scotland would like to pay a visit to Leith where the accountant in bankruptcy is based. It is impossible for people in financial difficulties to pay such a visit. In effect, we have a system of bankruptcy by post. How can people have access to good local advisers if everything is centralised in one place?
The Bill says nothing about counselling; yet I am told by the debt advisers that insolvency practitioners give good advice to people in difficulties. That is not mentioned in the Bill. Its purpose is betrayed by that because, clearly, it is not concerned with the welfare of low-income debtors.
We are told that the Bill has been introduced because of the expense of the present legislation. Lots of dodgy figures are floating about. It is suggested that, in 1994, 30,000 or 40,000 people will be seeking sequestration—perhaps that is the Government's comment on their own economic policies. One of those who spoke to me told me that on those projections the whole of Scotland would be bankrupt by the year 2010. That may be another fitting comment on the Government's economic policies, should they still be ruling Scotland then, which they will not.
Moreover, if the Government want to reduce the expenditure, there are other ways of doing so, such as by reducing the sequestration period from three to two or one year, by abolishing the block fee or by taking the accountants' offer to slash lees. If the Bill were about saving money, those measures could be adopted. The hidden agenda is the desire to cut numbers. Public expenditure savings will, of course, he made through reducing the numbers of those who have access to the sequestration procedure.
I appeal to my hon. Friends not to be seduced by the nationalisation argument. Nationalisation does not mean anything that is run by a Government official. I support nationalisation more than any other hon. Member—I hope that I am not insulting anybody present—although I would not necessarily use the word "nationalisation". I support nationalisation only if it helps working people and those who would like to be working people if the Government gave them the chance. The Bill does not help those people, which is why I shall vote against it tonight.

Mr. Brian Wilson: I shall concentrate initially on two issues. I do not know whether it is possible to have two nubs of the matter, but if it is, these are the key issues.
The first issue has not been sufficiently covered today. The letter from the Institute of Chartered Accountants of Scotland has been addressed to only a select group of Members, but it is fundamental to our consideration of the Bill. If the Minister is about to tell us, as the Secretary of State seemed to tell us earlier, that serious consideration is being given to accepting the ICAS proposition, the whole basis of the Bill is transformed. Indeed, much of its substance would be removed.
ICAS, having seen the Government's proposals and, presumably, recognised the seriousness of the Government's intent, is in effect saying, "Okay, the game's up. We'll do a cheap deal, guy." It is proposing in certain circumstances, and in cases with no assets, which are the great majority, to offer a deal of £800 plus the necessary outlays which, typically, it puts at £200 per sequestration.


I am in no position to assess whether that is a better or worse deal for the public purse than setting up a separate department, as the Government propose. If the Government agree that the ICAS deal solves most of the problem and they are willing to enter into a deal with ICAS whereby the fees are remeasured at that level, it is nonsense to proceed with a Bill whose central thrust is to set up a different procedure that would lie in abeyance for cases with no assets. The Minister shakes his head, but if he can explain to me how acceptance of the ICAS offer, if it can be called that, is not in conflict with the procedures on which virtually all our discussions in the Scottish Grand Committee and most of tonight's debate have been predicated, I shall be interested to hear from him.
The second issue has already been raised in an intervention by my hon. Friend the Member for Falkirk, East (Mr. Connarty). As several hon. Members have rightly pointed out, the drift of the Secretary of State's remarks seemed to be that the Bill was all about a numbers game; that the numbers have got out of hand. The corollary of that is that if the problem is to be resolved it must be through a cut in numbers.
In the Scottish Grand Committee, the Under-Secretary, in his reply, referred to the concern that the changes proposed in the Bill might result in debtors being denied access to sequestration; in other words, the numbers argument. He said:
I assure the Committee that the Government have no such intention. The savings in expenditure on sequestration will be achieved through tighter control over the fees paid to insolvency practitioners and through the introduction of simple procedures in small asset cases."—[Official Report, Scottish Grand Committee, 8 June 1992; c. 56.]
In other words, numbers have nothing to do with it. Numbers can go up. If that is what the force of social circumstances demands, so be it. But, according to that statement, all the savings will be made through cutting the level of costs per case, not attacking the number of cases.
That is obviously at odds with what was said by the Secretary of State and Conservative Members where clearly the populist line being taken is that there are far too many cases and a bit of discipline would be a great social advance because so many people are taking the easy option.
A written answer to the hon. Member for Moray (Mrs. Ewing) seems to point in the same direction. In reply to one of her questions, the Under-Secretary of State said:
It is clear that the major factor influencing the number of sequestrations in Scotland is the easier access by individuals to the sequestration process following the introduction of the 1985 Act."—[Official Report, 16 March 1992; Vol. 205, c. 821.]
If that is the source of the problem, one does not have to be unduly suspicious to believe that the Government's measure to deal with it will be to reduce access and thereby reduce the number of sequestrations.
It is the Opposition's case, and, in fairness, probably that of the more enlightened Conservative Members, that all the talk of easy options and people rushing into sequestration is nonsense. It is not true; it is a false picture. I agree, as I think will my hon. Friends, that creditors' interests must be protected. We are in favour of protecting creditors' interests and that should be built into the Bill. In addition, people must be protected from themselves. The idea of them being pushed into sequestration or

encouraged into sequestration, either as an allegedly easy option or in order further to swell the proceeds for the insolvency practitioners, is outrageous. If that is happening, it should be stopped. I am sure that there is no difference between hon. Members on that. But from what has been said tonight, there is a great difference between us on the prevalence of that practice. Certainly that charge cannot be levelled without some evidence being adduced.

Mr. Gallie: I have had constituents who have claimed that they have signed on to the sequestration process while in an emotional state without being aware of the consequences and that if they had been so aware they would not have signed on. That is a fact which to my mind is indisputable and which is part of the situation we face.

Mr. Wilson: It may be a fact, but it is certainly not indisputable, nor is it proven. The charge that the hon. Gentleman is levelling, presumably against his local accountants, is sufficiently serious to be taken up with them. I suspect that an interesting meeting would ensue. If the hon. Gentleman makes that charge, he is presumably capable of pursuing it.

Mr. Ernie Ross: Does not my hon. Friend think it rather strange that, if what the hon. Member for Ayr (Mr. Gallie) says is correct, there is nothing in the Bill about counselling. The evidence from those involved in the money advice centres and all the other organisations concerned was that they and the insolvency practitioners give a great deal of counselling. As I said in the Scottish Grand Committee, given that such people are in an emotional state, why is there no financial provision for counselling in the Bill?

Mr. Wilson: Those points strengthen the case that we are making for a further examination of the measure. It is offensive to insolvency practitioners, never mind to money advice organisations, to suggest that they are somehow inciting people to sequestrate, as though accountants were out in the street with a hook pulling them in in order to encourage them to sequestrate and thereby secure fees for themselves. It is not a picture that I recognise.
I draw the attention of the hon. Member for Ayr to figures with which I was supplied by the Strathclyde money advice service based in Ayr from a survey of cases in the Ayr, Irvine and Kilmarnock area, where 83 per cent. of multiple debt cases resulted in no sequestration and 17 per cent. did so result. Given those statistics, it is improbable that such incitement is going on. If it is, it should be identified and stopped. However, I have seen no evidence that it is going on, and we should not base legislation on the assumption that it is.
The hon. Member for Ayr referred to people escaping the poll tax by taking that extreme course of action. All hon. Members have had hundreds of cases of people who are in debt and difficulty because of the poll tax. I honestly have not come across one case in my constituency of anyone resolving that difficulty, or dreaming of resolving it, by recourse to sequestration. We are talking about people who are in multiple debt—catalogue, utility and bank debt. The idea that people are escaping from the poll tax by this device is fairly absurd.
I referred to the number of cases in Lerwick where only 16 individuals have sought sequestration in the past year. It was suggested that that said something peculiar about—or to the credit of—Lerwick, but looking through


a list of sequestrations by sheriff court area in Scotland I am struck not by the oddity of Lerwick but by the consistency of the position. With one or two blips, which could doubtlessly be investigated further, one finds great consistency of relatively low numbers in each area in proportion to population.
My hon. Friends the Members for Dundee, East (Mr. McAllion) and for Dundee, West (Mr. Ross) would be interested to know that, in the year ended 31 March 1992, the Dundee sheriff court had 131 sequestration cases. That is an extremely modest number in a city where everyone knows that a great deal of hardship exists.

Mr. McAllion: I am grateful to my hon. Friend for drawing that statistic to the attention of the House. He will know from information passed to me from the Dundee money advice project that its estimate of the number of cases of debt problems that it handles in a year—this is just one project in the city—is 12,000.

Mr. Wilson: That is a useful reinforcement of the point. Sequestrations represent only a tiny proportion of the total number of debt cases. Ayr sheriff court had 275 cases. That does not suggest that queues are forming each day to take this easy and attractive course. Incidentally, at Ayr sheriff court, the procedure has cost some £600,000. If the whole thing were wiped out, not many roads could be built on the proceeds. Falkirk has had 554 such cases, Forfar 31 and Elgin 151. Those figures are not excessive, and they do not suggest that a campaign is in operation to persuade people to sequestrate themselves.
We want the Bill to include protection for the right of the individual. We endorse the views of all the consumer organisations that have asked us to introduce such protection, so that people are not priced out of the process as they once were. The Minister told us the other day that the Government did not intend that to happen, but intention—or lack of intention—must be translated into the legislation.
The Scottish Consumer Council has asked for three specific assurances. First, it wants
a simple form of petition which can be completed by a non-legally qualified person".
Secondly, it wants
the technicalities of the reference to protected trust deeds deleted; a debtor should be able to petition without a qualified creditor and without having to say what the effect would be of a trustee trying to make a trust deed protected".
Thirdly, it wants
a Government undertaking that there will be no court dues in sequestration petitions.
I am sure that the Minister is as familiar with those demands as I am, and it would be encouraging if he gave an assurance—in the spirit of what he said in the Scottish Grand Committee—that they would be observed. If he does that, we shall be nearer to accepting that the Government's aim is not to limit the number of sequestrations, but to cut the costs in the ways suggested by other hon. Members and by the Institute of Chartered Accountants of Scotland.
The Opposition felt that this was a good opportunity for the Secretary of State to show a modicum of good will and common sense. In effect, the Bill overtakes an Act introduced seven short years ago by the same Government and, largely, the same Ministers. That Act was based on a travesty of false expectation in relation to its financial consequences. Now, the Government are again taking up the time of the House, Committees and individual

Members to introduce legislation that is intended to redress the calculating errors that they made in 1985. I feel that a small amount of humility is called for. It should not be beneath Ministers to accept that a bit of advice might help them to get the legislation right this time—legislation that they recognise as largely uncontentious on party grounds—so that we do not have to undo it again in a few years.
Having considered all that the Secretary of State has said since the general election about new approaches to Scottish legislation, the Opposition considered it eminently sensible to use an existing device to involve more people—lay people; people with some knowledge to offer hon. Members on both sides of the House—in the legislative process. It was a modest proposal, which was not especially partisan, a proposal that would have made this a better Bill than it will be. The Secretary of State, however, rejected it, and it is on that basis that his good intentions will be judged.

The Parliamentary Under-Secretary of State for Scotland (Mr. Allan Stewart): The hon. Member for Glasgow, Garscadden (Mr. Dewar) said that he had experienced an unexpected pleasure in Scottish politics. No doubt that is a fairly unusual experience for him nowadays. I am not sure whether the Bill was discussed at the meeting of Scottish Labour Members on Tuesday 2 June. We are indebted to the hon. Member for Hamilton (Mr. Robertson), who wrote in the "Commons Diary" in this week's issue of The House Magazine:
The day at 8.00 pm is still young and I attend a two and quarter hour meeting of Scottish Labour MPs. The Group these days is to fraternal, constructive discussion what Kylie Minogue is to Shakespearean acting".
Let us not be churlish and deny the hon. Member for Garscadden the occasional pleasure in Scottish politics. Such pleasures are rare and unexpected; let him enjoy them.
In our first debate, the hon. Gentleman said that he thought that I had introduced the Bill with gritted teeth. I assure him that my teeth are now ungritted, and I am delighted to be winding up the debate. We have heard a number of constructive speeches from Opposition Members: as well as two excellent speeches from Conservative Members: my hon. Friend the Member for Tayside, North (Mr. Walker) rightly pointed to the essential need for balance between the interests of debtor, creditor and taxpayer, while my hon. Friend the Member for Ayr (Mr. Gallie) made a number of positive suggestions, which the Government will consider.
The hon. Member for Garscadden, and a number of other hon. Members, have used terms such as "nationalisation", "market economy" and "market testing". In a generally constructive speech, for which I pay credit to him, the hon. Member for Cunninghame, North (Mr. Wilson) mentioned those concepts.
Let me make the position clear. It will doubtless come as no surprise to the House to learn that the Government are fully committed to market-testing the delivery of the sequestration service, in accordance with the principles which we have established. We shall look closely—this relates to a number of points made by hon. Members on both sides of the House—at the detailed implementation


of the Bill. We shall want to ensure that, wherever possible, the private sector has an opportunity to undertake the work when it can be done in a cost-effective manner.
At present, the advice agency directs the debtor to a particular insolvency practitioner, who in most cases determines who shall act in a particular sequestration. Neither the creditor nor the taxpayer who is paying for the process has any say in the matter. That relates specifically to the points made by my hon. Friends about the need for balance. In effect, the chosen practitioner is in a monopoly: provided that he maintains a good relationship with the advice agency in his handling of its clients, he can be confident of a steady stream of work.
The hon. Member for Falkirk, East (Mr. Connarty) has moved from a stance of opposition in the Scottish Grand Committee to his present considered scepticism. Let me tell him that the accountant in bankruptcy will be in a position to introduce a much stronger dose of competition into the process. By contracting out the provision of the service to insolvency practitioners, he can ensure that value for money and quality of service are secured. The best, most efficient and most effective practitioners are likely to gain from the process. That is market testing; it is the reverse of nationalisation.
A number of hon. Members—including the hon. Member for Orkney and Shetland (Mr. Wallace) in his intervention on my right hon. Friend the Secretary of State—have rightly focused on the advice function. The hon. Member for Dundee, West (Mr. Ross) was among those who asked who would be responsible for that function. The Government intend to give consideration—in consultation with money advice agencies and others—to the preparation of a guide to sequestration and its consequences, which could be made available to the general public. The preparation and making of such a guide and the provision of purely factual information on the process of sequestration will be the responsibility of the accountant in bankruptcy.

Mr. Dalyell: Will the money advice organisations that the Minister is consulting include the citizens advice bureaux?

Mr. Stewart: I can give the hon. Gentleman an absolute assurance on that point. Many citizens advice bureaux give excellent advice and have developed some excellent computer software in precisely this area.
We shall be preparing a guide and will consult organisations such as the citizens advice bureaux. However, the accountant in bankruptcy will not be involved in advising an individual debtor as to whether to petition for sequestration.

Mr. Wallace: I welcome the fact that the Minister has said that a guide will be drawn up. Will advice and help also be given to the various bureaux with regard to alternatives to sequestration?

Mr. Stewart: Indeed. Both the hon. Member for Cunninghame, North and the hon. Member for Dundee, East (Mr. McAllion) pointed correctly to the fact that the majority of debt problems do not result in sequestration because of the advice that people receive.
Through the urban programme the Government have committed support amounting to £1.25 million to money

advice centres in Scotland to ensure that debtors have access to good advice. The hon. Member for Linlithgow (Mr. Dalyell) will be reassured when I tell him that the Government have also provided core funding of over 1.4 million to Citizens Advice Scotland to assist its work with citizens advice bureaux.
Turning to the major point that hon. Members have made in this debate, I repeat the assurance that I have already given and that my right hon. Friend the Secretary of State for Scotland gave earlier today—savings will not be made at the expense of debtors' rights. The savings will come from two sources: more streamlined procedures and the Secretary of State's control of fees. A number of hon. Members have referred to the letter from the Institute of Chartered Accountants of Scotland, which says specifically that a major contributor to the savings that it identified will be the streamlined procedures that are set out in the Bill. I am glad that the hon. Member for Garscadden agrees.
The point that has been made about access relates specifically to legal aid. Debtors will be able to apply for legal aid for the purpose of obtaining the assistance of a solicitor in drawing up and presenting a petition for sequestration. In practice, we expect most debtor petitioners to be funded through the existing legal aid, advice and assistance scheme that is administered by solicitors. That advice can be provided quickly.
I repeat the assurance that I gave to the hon. and learned Member for Fife, North-East (Mr. Campbell) in the Scottish Grand Committee debate: we are also actively considering the extension of the assistance by way of representation scheme to provide legal assistance where a solicitor may have to appear before the court. Hon. Members should, of course, be able to raise questions of eligibility in Committee. That is the correct use of the Standing Committee procedure, but I give that absolute assurance about the Government's intention.
Hon. Members have referred to the provision of services in areas other than rural areas. In the Scottish Grand Committee proceedings the right hon. and learned Member for Monklands, East (Mr. Smith) asked about the position in areas outside Edinburgh. The Bill will enable the accountant in bankruptcy to employ agents to perform any of his functions in individual sequestrations. I envisage the accountant taking advantage of that power, which will allow him to appoint practitioners in the more remote rural areas and in many other parts of Scotland as his agent, in order to ensure that a good quality of service is provided to debtors.
A number of hon. Members referred to the Institute of Chartered Accountants of Scotland's proposals which we have received today. We shall need to consider them carefully. A number of interesting ideas are set out in the institute's letter.

Mr. Dewar: They represent not minor amendments but a fundamental change to the Bill which sets out to deal with an enormous increase in schedule 2 cases and the consequential burden on the public purse. It has been decided that that problem should be dealt with by passing responsibility to the accountant in bankruptcy. The Institute of Chartered Accountants of Scotland proposes that it should remain in the driving seat but that there should be a very much lower fee scale and simplified procedures. It is not just a matter of looking at the


proposal with interest. The fundamental question is whether, subject to detailed examination, that is an acceptable proposition.

Mr. Stewart: The Institute of Chartered Accountants of Scotland does not ask in its letter for the withdrawal of the Bill—quite the reverse. The institute has argued consistently that there is a great deal of merit in the Bill, as I believe the hon. Member for Orkney and Shetland would confirm. It has put forward a series of detailed proposals and interesting ideas. One of those is encouragement of the greater use of protected trust deeds. One would need to take account of the interets of creditors when examining the proposals. The hon. Member for Orkney and Shetland and others have confirmed that we are looking sympathetically at a change in procedure for non-schedule 2 cases.
A number of hon. Members asked detailed questions, one of which related to the self-employed. The statistics are unreliable, but they show that of those who have indicated their status, about 49 per cent. have no occupation or are unemployed and about 32 per cent. are employees. The balance is 19 per cent.
During the debate, Opposition Members have alleged that there has not been proper consultation. It is widely recognised that reform of the 1985 Act is needed urgently. We have brought forward our proposals after careful monitoring of the operation of the 1985 Act by the Department of Trade and Industry. The Bill was published on 8 May. It was then available to interested parties. It was considered in the Scottish Grand Committee on 4 June and 7 June, some 27 days after publication. Between then and today's Second Reading debate, nine more days have passed.
The earliest date for consideration of the Bill in Standing Committee is 30 June, merely a fortnight from now.
As my right hon. Friend the Secretary of State rightly told the House, by then there will have been seven and a half weeks for representations to be made and considered. I share entirely the objective of all hon. Members that we should get the Bill right. There is broad agreement on the objectives of the Bill. There is also broad agreement on the need to achieve a balance between the interests of the debtors, the creditors and the taxpayer. Of course it is our objective to get it right in Committee. That is the sensible way to proceed. I urge the House to accept the Bill and to reject the Opposition's motion.

Amendment negatived.

Main Question put forthwith, pursuant to Standing Order No. 60 (Amendment on Second or Third Reading), and agreed to.

Bill accordingly read a Second time.

Motion made, and Question put forthwith, pursuant to Standing Order No. 61 (Committal of Bills), That the Bill be committed to a Special Standing Committee.—[Mr. Dewar.]

The House divided: Ayes 262, Noes 294.

Division No. 34]
[7.00 pm


AYES


Abbott, Ms Diane
Anderson, Donald (Swansea E)


Adams, Mrs Irene
Anderson, Ms Janet (Ros'dale)


Ainger, Nicholas
Armstrong, Hilary


Ainsworth, Robert (Cov'try NE)
Ashdown, Rt Hon Paddy


Allen, Graham
Ashton, Joe


Alton, David
Austin-Walker, John





Banks, Tony (Newham NW)
Garrett, John


Barnes, Harry
Gerrard, Neil


Battle, John
Gilbert, Rt Hon Dr John


Bayley, Hugh
Godman, Dr Norman A.


Beckett, Margaret
Godsiff, Roger


Benn, Rt Hon Tony
Golding, Mrs Llin


Bennett, Andrew F.
Gordon, Mildred


Benton, Joe
Graham, Thomas


Bermingham, Gerald
Grant, Bernie (Tottenham)


Berry, Roger
Griffiths, Nigel (Edinburgh S)


Betts, Clive
Griffiths, Win (Bridgend)


Blair, Tony
Grocott, Bruce


Blunkett, David
Gunnell, John


Boyce, Jimmy
Hain, Peter


Boyes, Roland
Hall, Mike


Bradley, Keith
Hanson, David


Bray, Dr Jeremy
Hardy, Peter


Brown, Gordon (Dunfermline E)
Harman, Ms Harriet


Brown, N. (N'c'tle upon Tyne E)
Harvey, Nick


Bruce, Malcolm (Gordon)
Henderson, Doug


Burden, Richard
Heppell, John


Byers, Stephen
Hill, Keith (Streatham)


Caborn, Richard
Hinchliffe, David


Callaghan, Jim
Hogg, Norman (Cumbernauld)


Campbell, Ms Anne (C'bridge)
Home Robertson, John


Campbell, Menzies (Fife NE)
Hood, Jimmy


Campbell, Ronald (Blyth V)
Hoon, Geoff


Canavan, Dennis
Howarth, George (Knowsley N)


Cann, James
Howells, Dr. Kim (Pontypridd)


Carlile, Alexander (Montgomry)
Hoyle, Doug


Chisholm, Malcolm
Hughes, Kevin (Doncaster N)


Clapham, Michael
Hughes, Robert (Aberdeen N)


Clark, Dr David (South Shields)
Hughes, Roy (Newport E)


Clarke, Eric (Midlothian)
Hutton, John


Clarke, Tom (Monklands W)
Ingram, Adam


Clelland, David
Jackson, Ms Glenda (H'stead)


Coffey, Ms Ann
Jackson, Ms Helen (Shef'ld, H)


Connarty, Michael
Jamieson, David


Cook, Robin (Livingston)
Johnston, Sir Russell


Corbyn, Jeremy
Jones, Barry (Alyn and D'side)


Cousins, Jim
Jones, Jon Owen (Cardiff C)


Cox, Tom
Jones, Ms Lynne (B'ham S O)


Cryer, Bob
Jones, Martyn (Clwyd, SW)


Cummings, John
Jones, Nigel (Cheltenham)


Cunliffe, Lawrence
Jowell, Ms Tessa


Cunningham, Jim (Covy SE)
Kaufman, Rt Hon Gerald


Cunningham, Dr John (C'p'l'nd)
Kennedy, Charles (Ross, C & S)


Dafis, Cynog
Kennedy, Ms Jane (L'P'l Br'g'n)


Dalyell, Tam
Kilfoyle, Peter


Darling, Alistair
Kirkwood, Archy


Davidson, Ian
Leighton, Ron


Davies, Bryan (Oldham C'tral)
Lestor, Joan (Eccles)


Davies, Rt Hon Denzil (Llanelli)
Lewis, Terry


Davies, Ron (Caerphilly)
Litherland, Robert


Davis, Terry (B'ham, H'dge H'l)
Livingstone, Ken


Denham, John
Lloyd, Tony (Stretford)


Dewar, Donald
Llwyd, Elfyn


Dixon, Don
Loyden, Eddie


Dobson, Frank
Lynne, Ms Liz


Donohoe, Brian
McAllion, John


Dowd, Jim
McCartney, Ian


Dunnachie, Jimmy
MacDonald, Calum


Dunwoody, Mrs Gwyneth
McFall, John


Eagle, Ms Angela
McKelvey, William


Eastham, Ken
Mackinlay, Andrew


Enright, Derek
McLeish, Henry


Etherington, William
Maclennan, Robert


Evans, John (St Helens N)
McMaster, Gordon


Ewing, Mrs Margaret
McNamara, Kevin


Fatchett, Derek
McWilliam, John


Faulds, Andrew
Madden, Max


Fisher, Mark
Mahon, Alice


Flynn, Paul
Mandelson, Peter


Foster, Derek (B'p Auckland)
Marek, Dr John


Foster, Donald (Bath)
Marshall, David (Shettleston)


Fraser, John
Marshall, Jim (Leicester, S)


Fyfe, Maria
Martin, Michael J. (Springburn)


Galbraith, Sam
Martlew, Eric


Galloway, George
Maxton, John


Gapes, Michael
Meacher, Michael






Meale, Alan
Sheerman, Barry


Michael, Alun
Sheldon, Rt Hon Robert


Michie, Bill (Sheffield Heeley)
Shore, Rt Hon Peter


Michie, Mrs Ray (Argyll Bute)
Short, Clare


Milburn, Alan
Simpson, Alan


Miller, Andrew
Skinner, Dennis


Mitchell, Austin (Gt Grimsby)
Smith, Andrew (Oxford E)


Moonie, Dr Lewis
Smith, C. (Isl'ton S & F'sbury)


Morgan, Rhodri
Smith, Rt Hon John (M'kl'ds E)


Morley, Elliot
Smith, Llew (Blaenau Gwent)


Morris, Rt Hon A. (Wy'nshawe)
Snape, Peter


Morris, Estelle (B'ham Yardley)
Soley, Clive


Morris, Rt Hon J. (Aberavon)
Spellar, John


Mudie, George
Squire, Rachel (Dunfermline W)


Murphy, Paul
Steel, Rt Hon Sir David


Oakes, Rt Hon Gordon
Steinberg, Gerry


O'Brien, Michael (N W'kshire)
Stevenson, George


O'Brien, William (Normanton)
Stott, Roger


O'Hara, Edward
Strang, Gavin


Olner, William
Straw, Jack


Orme, Rt Hon Stanley
Taylor, Mrs Ann (Dewsbury)


Parry, Robert
Taylor, Matthew (Truro)


Patchett, Terry
Thompson, Jack (Wansbeck)


Pendry, Tom
Turner, Dennis


Pickthall, Colin
Tyler, Paul


Pike, Peter L.
Vaz, Keith


Pope, Greg
Walker, Rt Hon Sir Harold


Powell, Ray (Ogmore)
Wallace, James


Prentice, Ms Bridget (Lew'm E)
Walley, Joan


Prentice, Gordon (Pendle)
Wardell, Gareth (Gower)


Primarolo, Dawn
Wareing, Robert N


Purchase, Ken
Watson, Mike


Quin, Ms Joyce
Wicks, Malcolm


Randall, Stuart
Wigley, Dafydd


Redmond, Martin
Williams, Rt hon Alan (Sw'n W)


Richardson, Jo
Williams, Alan W (Carmarthen)


Robertson, George (Hamilton)
Wilson, Brian


Robinson, Geoffrey (Co'try NW)
Winnick, David


Roche, Ms Barbara
Wise, Audrey


Rogers, Allan
Worthington, Tony


Rooker, Jeff
Wray, Jimmy


Rooney, Terry
Wright, Dr Tony


Ross, Ernie (Dundee W)
Young, David (Bolton SE)


Rowlands, Ted



Ruddock, Joan
Tellers for the Ayes:


Salmond, Alex
Mr. Sydney Chapman and


Sedgemore, Brian
Mr. David Lightbown




NOES


Adley, Robert
Bottomley, Peter (Eltham)


Ainsworth, Peter (East Surrey)
Bottomley, Rt Hon Virginia


Aitken, Jonathan
Bowden, Andrew


Alexander, Richard
Bowis, John


Alison, Rt Hon Michael (Selby)
Boyson, Rt Hon Sir Rhodes


Allason, Rupert (Torbay)
Brandreth, Gyles


Amess, David
Brazier, Julian


Ancram, Michael
Bright, Graham


Arbuthnot, James
Brooke, Rt Hon Peter


Arnold, Jacques (Gravesham)
Brown, M. (Brigg & Cl'thorpes)


Arnold, Sir Thomas (Hazel Grv)
Browning, Mrs. Angela


Ashby, David
Bruce, Ian (S Dorset)


Aspinwall, Jack
Budgen, Nicholas


Atkins, Robert
Burt, Alistair


Atkinson, David (Bour'mouth E)
Butcher, John


Atkinson, Peter (Hexham)
Butler, Peter


Baker, Nicholas (Dorset North)
Butterfill, John


Baldry, Tony
Carlisle, Kenneth (Lincoln)


Banks, Matthew (Southport)
Carrington, Matthew


Banks, Robert (Harrogate)
Carttiss, Michael


Bates, Michael
Cash, William


Batiste, Spencer
Channon, Rt Hon Paul


Beggs, Roy
Chaplin, Mrs Judith


Bellingham, Henry
Clappison, James


Bendall, Vivian
Clarke, Rt Hon Kenneth (Ruclif)


Beresford, Sir Paul
Clifton-Brown, Geoffrey


Biffen, Rt Hon John
Coe, Sebastian


Blackburn, Dr John G.
Colvin, Michael


Bonsor, Sir Nicholas
Congdon, David


Booth, Hartley
Conway, Derek


Boswell, Tim
Coombs, Anthony (Wyre For'st)





Coombs, Simon (Swindon)
Hunt, Rt Hon David (Wirral W)


Cope, Rt Hon Sir John
Hunt, Sir John (Ravensbourne)


Couchman, James
Hunter, Andrew


Cran, James
Hurd, Rt Hon Douglas


Currie, Mrs Edwina (S D'by'ire)
Jack, Michael


Curry, David (Skipton & Ripon)
Jenkin, Bernard


Davies, Quentin (Stamford)
Jessel, Toby


Davis, David (Boothferry)
Johnson Smith, Sir Geoffrey


Day, Stephen
Jones, Gwilym (Cardiff N)


Devlin, Tim
Jones, Robert B. (W H'f'rdshire)


Dicks, Terry
Kilfedder, Sir James


Dorrell, Stephen
Kirkhope, Timothy


Douglas-Hamilton, Lord James
Knapman, Roger


Dover, Den
Knight, Mrs Angela (Erewash)


Duncan, Alan
Knight, Greg (Derby N)


Duncan-Smith, Iain
Knight, Dame Jill (Bir'm E'st'n)


Dunn, Bob
Knox, David


Durant, Sir Anthony
Kynoch, George (Kincardine)


Dykes, Hugh
Lait, Mrs Jacqui


Eggar, Tim
Lamont, Rt Hon Norman


Elletson, Harold
Lang, Rt Hon Ian


Evans, David (Welwyn Hatfield)
Lawrence, Sir Ivan


Evans, Jonathan (Brecon)
Legg, Barry


Evans, Nigel (Ribble Valley)
Lennox-Boyd, Hon Mark


Evans, Roger (Monmouth)
Lidington, David


Evennett, David
Lilley, Rt Hon Peter


Faber, David
Lloyd, Peter (Fareham)


Fabricant, Michael
Lord, Michael


Fairbairn, Sir Nicholas
Luff, Peter


Fenner, Dame Peggy
Lyell, Rt Hon Sir Nicholas


Field, Barry (Isle of Wight)
MacGregor, Rt Hon John


Fishburn, John Dudley
MacKay, Andrew


Forman, Nigel
Maclean, David


Forsyth, Michael (Stirling)
McLoughlin, Patrick


Forsythe, Clifford (Antrim S)
McNair-Wilson, Sir Patrick


Forth, Eric
Madel, David


Fox, Dr Liam (Woodspring)
Maitland, Lady Olga


Fox, Sir Marcus (Shipley)
Malone, Gerald


Freeman, Roger
Mans, Keith


French, Douglas
Marland, Paul


Fry, Peter
Marlow, Tony


Gallie, Phil
Marshall, John (Hendon S)


Gardiner, Sir George
Martin, David (Portsmouth S)


Garel-Jones, Rt Hon Tristan
Mawhinney, Dr Brian


Garnier, Edward
Merchant, Piers


Gill, Christopher
Milligan, Stephen


Gillan, Ms Cheryl
Mills, Iain


Goodlad, Rt Hon Alastair
Mitchell, Andrew (Gedling)


Goodson-Wickes, Dr Charles
Moate, Roger


Gorman, Mrs Teresa
Monro, Sir Hector


Gorst, John
Montgomery, Sir Fergus


Greenway, Harry (Ealing N)
Moss, Malcolm


Griffiths, Peter (Portsmouth, N)
Nelson, Anthony


Grylls, Sir Michael
Neubert, Sir Michael


Gummer, Rt Hon John Selwyn
Newton, Rt Hon Tony


Hague, William
Nicholls, Patrick


Hamilton, Neil (Tatton)
Nicholson, David (Taunton)


Hampson, Dr Keith
Nicholson, Emma (Devon West)


Hannam, Sir John
Norris, Steve


Hargreaves, Andrew
Onslow, Rt Hon Cranley


Harris, David
Oppenheim, Phillip


Haselhurst, Alan
Ottaway, Richard


Hawkins, Nicholas
Page, Richard


Hawksley, Warren
Paice, James


Hayes, Jerry
Patnick, Irvine


Heald, Oliver
Patten, Rt Hon John


Heathcoat-Amory, David
Pawsey, James


Hendry, Charles
Peacock, Mrs Elizabeth


Heseltine, Rt Hon Michael
Pickles, Eric


Hicks, Robert
Porter, Barry (Wirral S)


Higgins, Rt Hon Terence L.
Porter, David (Waveney)


Hill, James (Southampton Test)
Portillo, Rt Hon Michael


Hogg, Rt Hon Douglas (G'tham)
Powell, William (Corby)


Horam, John
Redwood, John


Hordern, Sir Peter
Renton, Rt Hon Tim


Howard, Rt Hon Michael
Richards, Rod


Howarth, Alan (Strat'rd-on-A)
Riddick, Graham


Howell, Rt Hon David (G'dford)
Robathan, Andrew


Howell, Ralph (North Norfolk)
Roberts, Rt Hon Sir Wyn


Hughes Robert G. (Harrow W)
Robertson, Raymond (Ab'd'n S)






Robinson, Mark (Somerton)
Temple-Morris, Peter


Roe, Mrs Marion (Broxbourne)
Thomason, Roy


Rowe, Andrew (Mid Kent)
Thompson, Patrick (Norwich N)


Rumbold, Rt Hon Dame Angela
Thornton, Sir Malcolm


Ryder, Rt Hon Richard
Thurnham, Peter


Sackville, Tom
Townend, John (Bridlington)


Scott, Rt Hon Nicholas
Tracey, Richard


Shaw, David (Dover)
Tredinnick, David


Shaw, Sir Giles (Pudsey)
Trend, Michael


Shephard, Rt Hon Gillian
Twinn, Dr Ian


Shepherd, Colin (Hereford)
Vaughan, Sir Gerard


Shepherd, Richard (Aldridge)
Walden, George


Shersby, Michael
Walker, Bill (N Tayside)


Sims, Roger
Waller, Gary


Skeet, Sir Trevor
Ward, John


Smith, Tim (Beaconsfield)
Wardle, Charles (Bexhill)


Soames, Nicholas
Waterson, Nigel


Spencer, Sir Derek
Watts, John


Spicer, Sir James (W Dorset)
Wells, Bowen


Spicer, Michael (S Worcs)
Wheeler, Sir John


Spink, Dr Robert
Whitney, Ray


Spring, Richard
Whittingdale, John


Sproat, Iain
Widdecombe, Ann


Squire, Robin (Hornchurch)
Wiggin, Jerry


Stanley, Rt Hon Sir John
Wilkinson, John


Steen, Anthony
Willetts, David


Stephen, Michael
Wilshire, David


Stern, Michael
Winterton, Mrs Ann (Congleton)


Stewart, Allan
Winterton, Nicholas (Macc'f'ld)


Streeter, Gary
Wolfson, Mark


Sumberg, David
Wood, Timothy


Sweeney, Walter
Yeo, Tim


Sykes, John
Young, Sir George (Acton)


Tapsell, Sir Peter



Taylor, Ian (Esher)
Tellers for the Noes:


Taylor, Rt Hon D. (Strangford)
Mr. Eric Illsley and


Taylor, John M. (Solihull)
Mr. Thomas McAvoy.


Taylor, Sir Teddy (Southend, E)

Question accordingly negatived.

Bill committed to a Standing Committee, pursuant to Standing Order No. 61 (Committal of Bills).

Orders of the Day — King's Cross Railways (No. 2) Bill (By Order)

Order for Second Reading read.

Mr. Garry Waller: I beg to move, That the Bill be now read a Second time.
The Bill is a more modest measure than the first Bill of the same name, but it represents an important part of the overall King's Cross project. Before I outline the details of the proposals, it will be helpful to the House if I put the Bill in its proper context.
The Bill follows on from works proposed in the original King's Cross Railways Bill, which is now in Committee in another place.

Mr. Jeremy Corbyn: rose—

Mr. Waller: If the hon. Gentleman will forgive me, I shall get a little further into my speech before giving way, although I shall certainly give way to him soon.
Hon. Members will recall that the purpose of the King's Cross Railways Bill was, first, to provide facilities for an enhanced Thameslink service across London, and, secondly, to provide a second international terminal for channel tunnel passenger trains with the best possible interchange from existing InterCity and Network SouthEast services. Thirdly, it was to provide increased capacity for domestic services at the existing St. Pancras and King's Cross main line stations.
During four days of debate in this House on the principal Bill, I attempted to demonstrate the strategic importance of the King's Cross project not only to London but to the many other parts of the country which the enhanced King's Cross and St. Pancras station would link to the capital and to Europe. I hope that hon. Members will not seek to reopen the debate on the issues in the principal Bill, which was passed on 28 January by an overwhelming majority. Perhaps if they do try to do so you, in your wisdom, Madam Deputy Speaker, will rule them out of order.

Mr. Corbyn: The hon. Gentleman is aware that the first Bill has not completed its passage through Parliament and is being considered elsewhere. Given the hon. Gentleman's close links with the British Railways Board, and in view of the property slump in London, can he tell us whether the board is seriously considering dropping the whole project, including the office development to the north of the proposed station site? If that is on the cards, this Bill will be redundant.

Mr. Waller: No such proposal is on the cards. Indeed, only a few days ago an important announcement was made about the new concourse building for which a planning application is to be submitted. Although there may be short-term problems when considering a Bill that will give the go-ahead to a project lasting a number of years, such short-term considerations will play a relatively minor part. The railway lands which are the essential subject of the principal Bill are regarded by British Rail as an important part of its strategy for the inter-city railway of the 21st century. As a regular user of the station, I look forward to its completion.
In the original Bill a number of new railway links are proposed to join the sub-surface station and St. Pancras


with the east coast main line. The purpose of the works is to improve the journey opportunities and capacity at the new station complex, especially for Thameslink and for international passengers. It will be recalled that those passengers will make use of a sub-surface station which will be linked to the existing one.

Mr. Chris Smith: The hon. Gentleman has so far spent all his time referring to the original Bill and the proposals for a channel tunnel terminus at King's Cross. He will be aware that only about 5 per cent. of this Bill has any direct relevance to the international station or the original Bill. That 5 per cent. relates to four minor access points. The overwhelming bulk of the Bill is about making a railway link into a concrete batching plant at a site in Holloway in the middle of my constituency.

Mr. Waller: I have devoted about four sentences to the original Bill, to put this one in context. I also tried to answer the hon. Member for Islington, North (Mr. Corbyn). I am sorry now that I allowed the hon. Member for Islington, South and Finsbury (Mr. Smith) to intervene, because I am anxious to make progress and to get on to the subject of the Bill.
One consequence of the works carried out to provide this new link will be the displacement of the Marcon and Pioneer Willment building materials plants which are at the northern end of the King's Cross site. Here we come to the heart of the proposals in the Bill. King's Cross has been a good site for these two firms, and since the 1960s it has enabled them to dispatch concrete to locations throughout the City and the west end.
The construction industry imposes extremely stringent requirements on its suppliers. To comply with BS5328, concrete should be discharged from delivery vehicles within two hours of loading. Sometimes it is demanded that unloading should be effected within an hour. To meet these stringent demands, and to retain the laudable commitment—I hope that all hon. Members support it—of bringing in aggregates to the plants by rail, other sites in north London were considered by the companies as an alternative to King's Cross. Lough road in Holloway was one of the few sites identified as fit for this purpose, both in reports by consultants hired by BR and—quite independently—by the Association of London Borough Planning Officers. It was the only site suitably close to central London for Pioneer Willment and Marcon.
While preparing for this debate I visited the site. I cannot claim to have anything like the detailed knowledge possessed by the hon. Member for Islington, South and Finsbury, in whose constituency it lies, but I have a reasonably good idea of the location and of the implications that this development would have for the people who live alongside it.
Since the 19th century, Lough road has been the site of a railway goods yard and it has only recently become disused. In its time it has been a cattle yard and, more recently, a Motorail depot. The proposals in the Bill seek to return the site to something akin to its original purpose. Indeed, in planning terms, the location is widely regarded as best suited to B2 or general industrial use. As recently as 1986, it was identified as such in the Islington

development plan, and it is included as such in the unitary development plan prepared by the borough of Islington in 1991, on which an inspector's report is awaited.
The plan includes the new Holloway access road allowed for in British Rail's own plans, and Islington council has already granted itself planning permission to construct the road. I suspect that several hon. Members will want to discuss that road further today.
The work in the Bill proposes to reinstate rail access into the site from the east coast main line. The works lie on BR land along former track formations in the area. There used to be a railway line, and the siding which provides rail access will closely match the track formation that used to be in place. The Bill also includes powers to construct and operate this facility, subject to planning permission. Consent has now been received from the relevant Secretaries of State following a public local inquiry into an appeal by British Rail against the non-determination by the London borough of Islington of BR's application for planning permission.
Many hon. Members will know that conditions were attached to the recommendation of the inspector. Minor road improvements have also been agreed following discussions between the borough and BR.
The railway works are in three parts. First, there is a line 1,009 m long from the Great Northern railway, now known as the east coast main line, into the site. Secondly, there is a 415 m line from the nearby Canonbury junction freight line into the line to which I have just referred. Thirdly, there is a 71 m line rejoining the siding to the east coast main line. Together, these works will allow aggregates trains to enter and leave the site from either direction without interfering with the busy commuter and inter-city traffic on the east coast main line.
I am aware that there are 16 petitions against the Bill and that many of them reflect the natural concern of local residents about the possible dust and noise levels in the area of the new plant. The use of the site was considered in depth at the public inquiry prior to consent being given. I am sure that those are the kinds of issue that are best dealt with by the Committee if petitioners wish to pursue them and if the Bill receives a Second Reading tonight.

Mr. Corbyn: In his researches, no doubt the hon. Gentleman considered the problem of the resiting of the concrete batching plant in the past by the same company at Monnery road, in my constituency. Has the hon. Gentleman had an opportunity to read the inspector's report which rejected that planning application? Similar words to those used by the hon. Gentleman in support of the new site were used in support of the other site, but they were rejected. Many of the arguments about dust, noise, pollution and traffic apply just as much to the new site as they did to the original site.

Mr. Waller: I have read the inspector's report and BR's arguments in favour of the proposal. I have also read the arguments of the London borough of Islington against the proposal and the arguments advanced by many local residents who were opposed to the development and who petitioned against it. I have also read a summary of the contribution made by the hon. Member for Islington, South and Finsbury.
At the end of the day, the inspector stated clearly that he did not believe that the concerns were sufficient to overrule the desirability of the site, bearing in mind the


considerable advantages that it would provide. Because he rejected the concerns about noise, dust and traffic, he did not think it necessary to consider whether there was an overwhelming need for the project. However, if he had not felt that there were good reasons for the consent to be applied, it could have been shown that there was a need which could not have been satisfied by locating the site anywhere else.
There are proposals to mitigate noise from the plant through the use of screening. That will provide suitable protection against plant noise and the process of loading and unloading material. The arrival and departure of trains will not significantly raise the level of noise of that busy railway route. The east coast main line carries a great deal of traffic. When channel tunnel traffic begins to use the line, the traffic will increase.
It is important to BR's future viability and success that there should be an increase in use of its lines, and I hope that all hon. Members would support that. Set against the use of that very busy line—one of the country's premier lines—it is not felt that the arrival and departure of trains in connection with the plant will significantly raise the level of noise, especially bearing in mind the agreements and conditions applied by the inspector with regard to night-time working.
Concerns were also expressed about the effects of dust. I noted that a number of those who gave evidence at the public inquiry had been to King's Cross and had expressed concern about the dust there. Monitoring has shown that there is not a great deal of dust at King's Cross. However, the plant at King's Cross was constructed many years ago and considerable progress has been made in applying dust suppression techniques.
Furthermore, the aggregates used in the batching process are damp and not inherently dusty. Proposals are included for the site for the damping down of the aggregates in the handling area. It is believed that dust levels will prove to be negligible. Monitoring of dust levels at King's Cross, where the levels have inherently been much greater than is anticipated at Lough road, show that there is absolutely no threat to health as interpreted by international health organisations.

Mr. Bob Cryer: The purpose of the Bill is to facilitate development at King's Cross. As the hon. Member for Keighley (Mr. Waller) said, King's Cross is a major terminus which will hopefully be a through station at the end of the premier east coast main line. In order to gain support for the Bill, perhaps he can explain something to me. In its very expensive document entitled "On Track for Europe", BR states that it is ordering daytime trains and that those trains
will provide daily services from Edinburgh, Manchester and Birmingham to Paris and to Brussels. Other stops are planned at Stockport, Crewe, Stafford, Coventry, Rugby and Milton Keynes and at Newcastle, Darlington, York, Doncaster and Peterborough.
The whole purpose of the King's Cross development has been to garner support from the provinces on the basis that trains will stop at major cities. With regard to the list to which I have referred, why will no trains originate from or stop at Leeds or Bradford?

Mr. Waller: I must be cautious about pursuing too far the point raised by the hon. Member for Bradford, South (Mr. Cryer), because that is not the subject of the Bill. However, the prospect of channel tunnel trains going to

Leeds is by no means ruled out, although I think that that would depend on the electrification of the link between Leeds and York which would enable trains on the east coast main line bound for Newcastle and Edinburgh to divert via Leeds. That might be considered and, for constituency reasons, I hope that it is implemented when the opportunity arises.
The second main proposal in the Bill is to improve access to the main works sites.

Mr. Corbyn: Will the hon. Gentleman give way?

Mr. Waller: I promise to give way to the hon. Gentleman in a moment.
It was one of the criticisms of the local authorities that the quality of access to the site was not ideal. The No. 2 Bill benefits from more detailed construction planning, and it proposes a remedy by providing three new temporary access points and by making one of the original access points permanent rather than temporary to meet the express requirements of the railways inspectorate for vehicular access in the event of emergencies. That should help to reduce even further use of the public highway and any possible congestion. It should allow swifter movement of vehicles to and from the site.
More of the construction traffic associated with the project will now be able to use major rather than residential roads, which will be particularly beneficial to residents of Wharfdale road, Balfe street and Railway street, three streets that figured prominently in our debate on the principal Bill.

Mr. Corbyn: I am not trying to throw the hon. Gentleman off his stride, but he seems to have ignored the implications of clause 9, which fits in with the question of the concrete batching plant at Lough road. I am sure that the hon. Gentleman is aware that the modifications proposed for the Hornsey road bridge fall within my constituency, as the boundary runs along the Holloway road, the northern side of which is in my constituency. Can the hon. Gentleman say how extensive will be those works to the Hornsey road bridge, and is he aware that the bridge was changed not so recently to make it narrower?

Mr. Waller: I am very much aware of the latter point. If BR had anticipated the present proposals, it would not have made that change. Nevertheless, it is necessary to build a new bridge alongside the existing one to enable the project to go ahead. I cannot at this stage answer the hon. Gentleman's point in full. However, if I can make progress quickly and finish my speech, there will be time for me to answer important points like that later in the debate, if I have the leave of the House to respond.
It is perhaps difficult for a Bill such as this to capture the imagination of the House. I hope, however, that it will be seen as an important adjunct to the original proposals.
The House should take the opportunity to allow Marcon and Pioneer Willment to remain in the business of providing high—quality concrete to central London, but, above all, we should allow them to continue to bring in their aggregates by rail. The hon. Member for Bradford, South is very keen for that to be facilitated, not only at King's Cross but in many parts of the country, and I applaud his intent.
It is certainly the policy of the Government and of the Opposition to develop opportunities for freight by rail,


and it commands the highest support in the House. This Bill must succeed if there is to be any credibility in that policy.
The proposals for access to the main King's Cross site are in response to the feeling that access could be improved. I hope that the measures in the No. 2 Bill will be seen as a measure of the promoter's willingness to respond to the concerns of local authorities and others.
I recognise hon. Members' important constituency concerns. However, there is a need for a concrete batching site. The public inquiry concluded that that was an appropriate site and that the concerns expressed by the objectors, although not totally insignificant by any means, were not such that the project should not go ahead. On that basis, I commend the Bill to the House.

Mr. Chris Smith: I oppose the Bill, and I do so most vigorously. It is a misleadingly titled Bill, because I suspect that British Rail quite deliberately wanted to imply that there was a direct connection between the works connected with this Bill and the new channel tunnel station at King's Cross, which was approved by the passage of the original King's Cross Railways Bill. The promulgation of this No. 2 Bill by British Rail has compounded that misleading impression. It has argued that the Bill is somehow an integral part of the placing at King's Cross of the channel tunnel traffic. It has sold the virtues of the No. 2 Bill on the back of that assumption. That assumption is totally incorrect.
The hon. Member for Keighley (Mr. Waller) tended to go a little bit in the same direction when he talked about the Bill being an adjunct to the original King's Cross Railways Bill. It is nothing of the sort. If the Bill were to fall and not be given a Second Reading, that would make virtually not one jot of difference to the proposals for the channel tunnel station at King's Cross.
The location of the channel tunnel traffic at King's Cross and its onward progress to the north-east and north-west is of great importance to many of my hon. Friends and indeed of particular importance to my hon. Friend the Member for Morley and Leeds, South (Mr. Gunnell), who has argued long and valiantly in a previous capacity for such direct links to the north. None of that—the location at King's Cross or the links to the north—would be affected at all if the Bill were defeated today.
I hope that British Rail will not try to argue that anything else is the case, because 95 per cent. of the Bill is about the specific location of a concrete batching plant on a specific site in the middle of my constituency—nothing more, nothing less. To imply that it is anything more is actually to mislead the House and the public as well.

Mr. Cryer: Does my hon. Friend agree that, if British Rail made assertions about the Bill, it would be unlikely to be believed because it suborned many provincial Members into supporting the original Bill on the claim—

Mr. Peter Snape: But not you.

Mr. Cryer: But not me. My hon. Friend is quite right. It suborned many hon. Members on the promise that there would be daily through trains, or at least through trains

from various major provincial cities. According to the publication that it recently released, that is patently not the case.

Mr. Smith: My hon. Friend is absolutely correct. He will recall that, in the Committee report on the King's Cross Railways Bill, British Rail was taken strenuously to task for the way in which it argued its case. I suspect that it is up to precisely the same tricks this time.
The statement that was issued by the propagators of the Bill in connection with the Second Reading states:
This Bill will confer on the Board additional powers to those being sought in the King's Cross Railways Bill".
They clearly give the impression in that supporting statement that there is a direct connection between the No. 2 Bill and the main King's Cross Railways Bill. There is not. Again, they give the same impression in the environmental summary which is in the Vote Office. They say:
The King's Cross Railways (No. 2) Bill contains two railway works proposals which are closely connected with the major improvements planned for King's Cross".
The works proposals are not closely connected with those major improvements. There are only two connections of any kind whatsoever. The first is the proposal in the No. 2 Bill for four new—three of them are temporary—access points to the main King's Cross works. Those are minor matters, but they are none the less contestable, and I shall refer to them in a moment, but they are not germane to the entirety of the King's Cross project. Indeed, if British Rail had wanted to, it could have introduced those new access points in amendments to the existing King's Cross Railways Bill.
The only other connection between the two schemes is the theme that ran through the introductory remarks of the hon. Member for Keighley, and that is the assumption that, because a concrete batching plant on the King's Cross Railway lands is going to be displaced—eventually—by developments at King's Cross, another site has to be identified for it. Of course, it does not have to be at Lough road. Those are the only two connections between the two Bills. For British Rail to pretend otherwise is disingenuous at best.

Mr. Snape: I might be as disingenuous as British Rail, although I hope not. If the plant is to be removed from its present site in King's Cross goods yard to the site proposed in the Bill, surely that establishes the very connection that my hon. Friend seeks to deny.

Mr. Smith: The last thing that I would accuse my hon. Friend of being is disingenuous. He has a formidable reputation for plain and honest speaking, but I fear that on that specific point he is wrong.
The Bill provides for the railway works in connection with a specific location for the concrete batching plant. There is a multitude of other possible locations. If one moves a concrete batching plant, one does not have to put it on Lough road. As I shall mention later, there is provision, for example, for a new temporary concrete batching plant on the King's Cross railway lands while construction continues on the new station. There is no reason whatever why that plant should not stay on the King's Cross railway lands. Perhaps a few square feet of office development might have to be removed from the London regenertion consortium scheme. But it would be perfectly possible to put the plant elsewhere.


My hon. Friend the Member for West Bromwich, East (Mr. Snape) is right to say that the removal of the concrete batching plant from King's Cross is an inevitable consequence of the original King's Cross Railways Bill, but the placing of that concrete batching plant on the Lough road site is by no means an inevitable consequence. That is the point at issue.
There are four new access points to the main King's Cross site. Three of them will be temporary. One is on the east corner of Caledonian road and Pentonville road. The second is on the west corner of Northdown street and Pentonville road. The first of those access points seems somewhat dangerous. I am sure that after a close inspection of the maps which have been tabled you would come to the same conclusion, Madam Deputy Speaker. Similarly, the second site lies outside the planned lorry routes for the King's Cross construction traffic. One has to assume, therefore, that the lorry routes will be changed to make use of that new access point. The second access point could also be dangerous, although perhaps less obviously so than the first.
The third new access point is on the south corner of Railway street and York way. That proposal is supposed to move an original access point midway along Railway street, and therefore much nearer to the residential houses in Balfe street, to the new south corner. However, Madam Deputy Speaker, you will undoubtedly recall from our discussions about the original King's Cross Railways Bill that the hon. Member for Keighley, who sponsored that Bill also, specifically refused to remove from the Bill the provision for the original access point halfway along Railway street. Now, we are told that a third new access point will be created, but that the original access point will not be removed. Therefore, far from allaying the fears of residents and the local authority, as the hon. Member for Keighley implied, British Rail is creating extra access points without removing any of the access points provided under the original Bill.
The new access point at the corner of Railway street and York way would require the complete demolition of the St. Pancras ironworks, a building which is considered to be the most significant unlisted building in the immediate area. There is an alternative: if British Rail did its homework properly—I am afraid that a long catalogue of instances in connection with the King's Cross project demonstrates that British Rail does not—it could have created a different access point a little further south on York way itself. That would have been much more acceptable to local people and equally good for British Rail. It would not have involved the demolition of any remarkable buildings.
The three new access points, all of which are in my constituency, do not add anything to the original Bill. Indeed, they make life worse rather than better for local people. The three access points which I mentioned are designed to be temporary. A fourth access point, provided for in the No. 2 Bill, will be permanent. It is on King's Cross road near Britannia street. It is supposed to provide emergency access to the station.
The new permanent access point is in the constituency of my hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson), who had hoped to be here with us this evening but has been unavoidably detained elsewhere. Of course there is a need for an emergency service access to the King's Cross site. However, I remain to be convinced that the position at Britannia street and King's

Cross road is the right one for that emergency access. Of course, it enlarges the area of land which will be gobbled up by British Rail in both Camden and Islington for the purposes of its new channel tunnel station project.
The new access provisions seem to be the only parts of the Bill which have a direct impact on the main King's Cross project. British Rail has not come up with good proposals for new access points. It has come up with detrimental proposals and it could have done better.
I note from the environmental statement tabled with the Bill that British Rail says that the provisions of the environment code of the King's Cross Railways Bill will apply to the construction of the new access points. As you will recall, Madam Deputy Speaker, we had a lengthy debate about the provisions of that environmental code when we discussed the main Bill. It was obvious from those discussions that the environmental code had not yet been agreed by the boroughs concerned. It still has not been agreed. It is inadequate. Blandly to say in the environmental impact statement that an environmental code will be in place to protect the interests of residents does not say much to the residents who will be affected.
Indeed, one must raise a fairly serious question about the validity of the entire environmental statement that British Rail has tabled in connection with the Bill. For example, under the heading "Cultural Heritage", it says:
The planning of the King's Cross Railways Bill works has taken account of the character of the surrounding area, in particular the location and characteristics of Conservation Areas, listed buildings and other buildings of importance and interest.
The planning has done nothing of the sort. I invite British Rail to tell that to the owners and proprietors of the Great Northern hotel, which will be knocked down under British Rail's proposals. To say that the planning has taken account of the character of the surrounding area is wholly invalid. An environmental assessment report which comes out with obviously bogus sentences of that nature cannot be taken as a properly serious document.

Mr. Michael Brown: The hon. Gentleman mentioned the conservation area and the Great Northern hotel. In the context of that argument, he should also have mentioned the Golden Lion public house, which is also in the conservation area and is likely to be demolished. Surely that is another sign of the fact that British Rail has not considered the conservation aspects of its proposals. Many people tend to think of the Great Northern hotel as the obvious watering hole for people in the area, but the Golden Lion pub is also well known and has a certain tradition and character.

Mr. Smith: The hon. Gentleman is absolutely right. I hope that he will be able to catch your eye later in our deliberations, Madam Deputy Speaker, so that he will tell us a little about the importance of the Golden Lion.

Mr. Waller: Perhaps I could abbreviate the expected comments about that pub. Contrary to what was said, British Rail has demonstrated its concern and is in discussions with the London borough of Camden, in whose area the unlisted public house is located. It may or may not be demolished as part of the work, but it is not true to say that British Rail has not been concerned about its future.

Mr. Smith: That is a classic instance of the way in which British Rail has acted in connection with the project—it


makes a proposal—in this case, for the demolition of a public house—begins to retreat from that position in the face of the fierce and logical opposition from all quarters and finally comes up with a half-baked solution.
That is what British Rail did about the access points which I mentioned, which are a minor part of the No. 2 Bill, representing at most 5 per cent. of its contents. I shall concentrate my remarks on the other 95 per cent., which concerns the concrete batching plant at the Lough road site and the railway works which will reach it. We cannot consider the railway works without considering the plant, as there will be no plant without railway access.
I shall place before my colleagues a number of reasons why we should not grant approval for a plant. The first and perhaps most important is that there is fierce local opposition to it. Several public meetings have been held. They were packed and were unanimous in their condemnation of the proposal. A number of local residents sat through the entire public local inquiry held by the planning inspector at Islington town hall, lasting several weeks. Many local residents expressed their concern in evidence to the planning inspector and many submitted petitions against the Bill.
I shall demonstrate the strength of feeling among local people. A letter from Mr. Fitzgerald, the chairman of the governors of Our Lady of the Sacred Heart school—a primary school next door to the proposed site of the concrete batching plant—says:
I am appalled at the idea of British Rail's proposal to build two Concrete Batching Plants at Piper Close within 200 yards of the school. I would like to put forward my objection to these plants being sited at Piper Close. To think that our children will have to live and learn in such an environment is unthinkable, impractical and a disgrace to the powers who thought of the idea in the first place. They say it will be dustproof? They mean as near as they can make it, not quite the same thing … Must our children live and learn with windows permanently closed … The traffic hazard will be much much worse than it is at the present time.
That is eloquent testimony to the concern felt about the school which is next door to the site in question.
The tenants association of Tealby, Soldene, Bramall and Geary houses on the Ringcross estate has written to say:
We the tenants association do object on behalf of our tenants and ourselves to the planning application made by British Rail/Marcon and Willment to build one of two concrete batching plants on the site between Piper Close and the railway line".
The letter lists the association's objections and highlights
The inappropriateness of this particular type of industrial activity next to residential dwellings.
The Ringcross estate lies directly by the site in question and many of the tenants on the estate will be directly affected by the siting of the concrete plant there.
The tenants association of Shearling way, which is also nearby, writes:
On behalf of the tenants of Shearling Way estate, we are objecting to the proposed concrete batching plant between Piper Close and the railway line … A number of our tenants back directly onto the railway lines and are very annoyed at the prospect of these trains running when people are normally asleep.
I shall come to the question of night-time operations in a moment, because the situation is unclear and the hon. Member for Keighley did not touch on it. The tenants association stresses that
this is very much a residential area".

It is right to do so.
A local general practitioner, Dr. Herwitz, whose practice covers the area around the site, has also written. He said:
I am writing to protest about the proposed plans to turn the Lough road site in London N7 into concrete batching plants. This will result in many hundreds of lorry journeys every day causing unacceptable levels of noise, dust and pollution.
A large number of journeys by HGVs in this dense residential area would result in serious hazards to pedestrians as well as to local traffic. There are numerous schools in the area and children would clearly be at increased risk. In addition, there are several day centres for the elderly and special accommodation for the disabled. These people in particular need to be able to get to their homes and facilities locally without being threatened by enormous concrete transporters. This is a residential area which includes some light industrial buildings. The industrial units mainly involve quiet processes and little in the way of continuous journeys to-and-fro by large vehicles. By and large, such light industrial factories and workshops work well together. However the proposed concrete batching plants will destroy the equilibrium of the area … In addition, they will also result in noisy night-time deliveries to the site. I know of many shift workers, including NHS nurses, who live near to this site whose sleep will be seriously disturbed if the proposals are given the go ahead.
That is but a small sample of the comments of local people, in positions of some authority and knowledge, who have argued strongly against the siting of the concrete batching plant at that location. Two themes of objections are overwhelmingly obvious. First, the area is residential, people's homes directly overlook the site and are cheek by jowl with it and they will be dramatically affected by the erection of the concrete plant.
The second major theme of the residents is not just the impact of the workings on the site but all the consequent movements of traffic, especially because the concrete aggregate will enter by train and leave by lorry. There will be many lorry movements in and out of the new site throughout the day.

Mr. Corbyn: Is my hon. Friend aware—I am sure he is—that one issue concerning the concrete batching plant, which came up at the Monnery road inquiry, was the short interval between the loading of lorries and the deliveries of the ready-mixed concrete? As the hon. Member for Keighley (Mr. Waller) pointed out, that sometimes takes an hour. There is a lot of traffic in Islington, so does my hon. Friend think that residential roads will be used increasingly to deliver the concrete quickly?

Mr. Smith: My hon. Friend may be right. I shall touch on that in a moment when I consider the traffic implications of the development, which are not quite what British Rail claims they are likely to be.
British Rail is up to its usual tricks with the main King's Cross development. Originally, it argued that that development would cause negligible traffic consequences, but it was forced to admit that some would arise. In addition, the Department of Transport estimates of disruption are considerably greater than those of British Rail. British Rail is playing the same tricks in this issue.

Mr. Michael Brown: The hon. Gentleman has referred to the noise on the site. It is important to note that that will not be caused by heavy goods vehicles alone. The concrete will arrive by train, so the hon. Gentleman should take account of page 27 of British Rail's environmental assessment, where it admits that the greatest potential for


noise from trains will be between midnight and 3 o'clock in the morning. It also admits that diesel engines will idle and one can imagine the noise that they will make. The problem is not just that of noise from trains moving into and out of the site but that of diesel engines idling as unloading takes place. That will have a dramatic impact on noise levels for local residents during the most inconvenient hours of the day.

Mr. Smith: The hon. Gentleman is absolutely right to draw attention to what British Rail says in its environmental statement.
We face something of a dilemma because in that report, British Rail suggested that there will be at least one night-time delivery of sand and aggregate to the batching plant. Of course, that will create noise. The hon. Gentleman rightly referred to diesel engines idling, but they will also shunt backwards and forwards. Trucks will be pulled one by one as they pass through the unloading bays. The noise impact of those activities in the early hours of the morning on the people whose homes are directly next door will be considerable.

Mr. Snape: I do not pretend that the noise of trains is music to everyone's ears, but will my hon. Friend tell us whether the rest of Islington, particularly its major roads, is a haven of peace and tranquillity all night?

Mr. Smith: For once, I fear that my charitable inclinations towards my hon. Friend are departing. He falls into exactly the same trap as British Rail did in its environmental statements. It has argued that the people of Islington already have to put up with noise, so if it loads a massive amount of extra noise on them, it will not matter. My hon. Friend cannot expect the people of Islington to accept that argument, which would add extra noise on top of that from which they already suffer. I accept that they live in a congested inner-city area and that many of them live beside roads and railway lines. They accept the constraints that that imposes on their quality of life, but it would be too much to subject them to extra, intrusive noise, especially in the middle of the night.

Mr. Corbyn: Does my hon. Friend recall that in 1983 we tabled an early-day motion which called for a Londonwide lorry ban? We were not entirely successful, but we achieved a night-time lorry ban and changed the attitudes of many local authorities, particularly our own. They have done their best to curb the use of heavy vehicles at night and to reduce the noise pollution from them. It is therefore highly inappropriate that people should be expected to put up with increased noise at night, because of the concrete batching plant, when those people have enjoyed a slight improvement in their living conditions because of the operation of the night-time lorry ban on the Holloway road.

Mr. Smith: My hon. Friend is correct. Perhaps he should have added that the former Greater London council played a creditable role in achieving a night-time lorry ban in London, which greatly benefited its residents.
We face a dilemma on night-time working. In its environmental statements, British Rail stated that there will be night-time deliveries of aggregate and sand and floodlighting of the site to enable the night-time work to carry on. The planning inspector in a recent report, to which British Rail does not refer in any of the documents that it has laid before the House, made recommendations

that are germane to the debate. He recommended that planning permission should be granted only on condition that no night-time operations take place. We need to know from British Rail whether it intends to pursue the idea of night-time working or whether it will accept the condition proposed by the planning inspector. At present, everything that British Rail has proposed assumes that there will be night-time operations.

Mr. Michael Brown: The hon. Gentleman is absolutely right to refer to the environmental assessments of noise levels, because it is beyond dispute that BR assumes night-time working will take place. However, he has disappointed me, because he has confined his remarks to the noise caused by heavy goods vehicles and shunting. I remind him—I hope that he will devote part of his speech to this—that, to unload the trucks, a vibrating machine will be necessary to grab the sand and gravel out of them. On pages 27 and 28 of volume two of the technical reports, British Rail admits that the greatest potential for noise comes from the machinery that will grab the sand and gravel from the railway trucks. That will also add to the noise caused by the diesel engines.

Mr. Smith: The hon. Gentleman is anticipating my argument, because I had intended to consider the issues of noise, dust and the nature of the working. However, he is right to draw our attention to page 27. A footnote to that statement says:
It is intended that deliveries of sand at night will be restricted, should it prove necessary.
Who determines whether it proves necessary? We need to know whether the planning inspector's restrictions on night-time operations will be accepted by British Rail. The papers which British Rail has tabled in the House show that it will not accept that restriction.

Mr. Waller: British Rail has accepted the condition applied by the planning inspector that there should be no night-time deliveries of aggregates to the site. It may have been thought that, compared with the large amount of traffic on the line, that was a relatively minor factor. Nevertheless, British Rail has accepted that, despite the fact that it causes some disadvantage. The limited number of deliveries at night would have been advantageous to British Rail, but it accepts the condition that the planning inspector has applied to his recommendation.

Mr. Smith: In that case, we are making some progress. We now have an acceptance by British Rail of the planning inspector's recommendation.
However, as the planning inspector pointed out, an inevitable consequence of reduced night-time activity on the site would be increased day-time activity. Therefore, although local residents are delighted that there will be no prospect of work until the small hours of the morning, the consequences of that must be taken into account.
The hon. Member for Keighly briefly mentioned the history of the site, and it may be appropriate if I deal for a moment or two with that subject. The site is interesting and has served many purposes in its lifetime. It was originally used for sidings, cattle pens and the premises of forage merchants. It was very much connected with its location directly beside the railway. It went through a long and tortuous history of different tenancies, uses and applications for planning permission.
It is worth noting that in 1962 British Rail declared the site to be surplus land and offered it to London county


council as a possible site for housing. That seems to show that, 30 years ago, British Rail felt that the best use for that site was not the use that is now proposed but something quite different. It is worth noting also that proposals have been made on several occasions for the creation of a concrete batching plant on the Lough road site. In 1970, the London borough of Islington turned down an application, giving as grounds for doing so the disturbance and noise that would be created for the occupants of an estate that was then under construction, which subsequently became the Ringcross estate, directly beside the site on which the Bill focuses.
The latest position is that British Rail, in association with the two concrete companies, has submitted two different applications for concrete batching facilities on the site. The Department of the Environment inspector has considered the matter, there has been a lengthy public local inquiry and vigorous local opposition has been expressed to the proposal. The inspector's report was issued only a few weeks ago, with the important proviso of no night-time working. I regret to say that it does not accept the opposition of local residents and the borough but recommends approval of the concrete batching plant. However, it clearly says that harm will be done to the amenities of local residents.
The inspector then develops the remarkable argument that, because the site is destined in the local plan for general industrial use, it does not matter what kind of industrial use the land is put to because everyone will accept that there will be disturbance and noise. There is a world of difference between an industrial use that it is possible and sensible to locate next door to residential accommodation and industrial use that it is not sensible to locate next door to residential accommodation. A concrete batching plant falls firmly in the latter category. I fear that the planning inspector has not accepted what seems to be a common-sense argument put strongly by local people.
Everything now depends on the Bill. If it does not go ahead, the concrete batching plant will not go ahead. But if it proceeds and it receives approval from both Houses of Parliament, the concrete batching plant will go ahead and many of my constituents will be directly damaged and disadvantaged by that fact. That is why I cannot accept the proposal.

Mr. Michael Brown: Does not the hon. Gentleman think that it is a fundamentally flawed way of going about matters to go first to the planning authority, then hold a public inquiry and, lastly, go to the Secretary of State? Is it not presumptuous to try to present a fait accompli to Parliament? If British Rail wanted to go ahead with the project, would it not have been more courteous to come first to Parliament with its proposals for legislation and, only after Parliament had determined whether the Bill should go ahead, hold a public inquiry? Was it not presumptuous of British Rail to say to the House, "Well, we have held a public inquiry and have the Secretary of State's permission, so will you kindly rubber-stamp it?"

Mr. Smith: Great as my respect is for the hon. Gentleman, I do not follow his argument entirely. I have long argued that the whole private Bill procedure is nonsense. It is no sensible way to make proper decisions

about local planning matters, which is basically what the Bill is about, or strategic principle decisions, which is what the main King's Cross Bill is about.
Other matters also need to be taken into account. In his opening remarks, the hon. Member for Keighley said that there was no alternative site and that, as a result of the removal of the batching plant in the King's Cross development, the new batching plant had to be located in Lough road because there was nowhere else for it to go. He said that everybody else had had a look and had come to the conclusion that it must be located at Lough road. That is explicitly stated in the environmental statement issued by British Rail.
But we are talking about a fairly substantial area. The way in which concrete is produced at a batching plant means that it can be transported from a large number of locations to central London. It does not have to come from the King's Cross or Holloway district but could come from any region within a suitable mileage of central London.
My hon. Friend the Member for Islington, North (Mr. Corbyn) mentioned Monnery road public inquiry and the inspector's report. That involved another proposal for a concrete batching plant—in his constituency, not mine —which attracted similarly fierce opposition from local residents. I am pleased that, in that case, the inspector saw sense and decided that the proposal should not go ahead. The subject of alternative locations arose during that inquiry. The Secretary of State's inspector said that there was a potential site at Juno way in New Cross.
Page 42 of the inspector's report stated that the potential site at Juno way
would be able to serve areas to the south of the Thames now operated from King's Cross.
It also stated:
I do not accept that the River Thames acts for practical purposes as a complete barrier to lorry movement.
It is clear from the inspector's report on Monnery road that the new site proposed at Juno way in New Cross could serve exactly the purpose proposed for the site at King's Cross. Since then, permission has been granted to develop the Juno way site as a concrete batching plant, so an alternative site does exist; for anyone, including British Rail, to pretend that it does not is not a valid argument.
New Cross is not the only alternative site and the question must be asked whether British Rail has looked closely enough at the land it owns at King's Cross. The proposals for the new international station at King's Cross touch on only a small proportion of British Rail's lands at King's Cross. There are proposals for a massive development of the remainder of those railway lands by the London regeneration consortium. I am by no means convinced that it is impossible to find a corner of the King's Cross railway lands that could be used for the relocation of the present concrete batching plant.
At a briefing meeting held in April 1991 on its King's Cross development proposals, British Rail said that it intended to build two concrete plants in the north-west corner of the King's Cross railway lands site for the period of redevelopment and construction of those lands. If it can build two concrete plants on its own King's Cross land for the duration of the King's Cross development, why on earth can it not have two concrete plants to last beyond the time of its redevelopment of the King's Cross railway lands at that location?
I cannot accept that there is no alternative to the Lough road site; there are clear alternatives, two of which I have already identified. I am sure that, if we combed the whole of central and inner London for alternative sites, we could come up with a considerable number of other alternatives.

Mr. Corbyn: I am sure that my hon. Friend is aware—although he has not mentioned it—that during the Monnery road and Lough road inquiries the issue of likely future demand for ready-mix concrete was also mentioned. I wonder whether we are planning for over-production of the material and whether we may end up with far too many facilities for producing it to meet the demand.

Mr. Smith: My hon. Friend is correct. We all know what has happened to the construction industry in recent years. There is 25 per cent. over-capacity in office space in London. The demand for concrete has fallen substantially in recent years. We hope that the construction industry will pick up, although I doubt that it will, given Government policies. We must seriously question whether there is a need for the two plants to continue in existence or whether the need for concrete in the inner London district cannot be met by other existing plants, without dumping a new one in the middle of a residential district.
There are other worries, some of which the hon. Member for Keighley mentioned. There is much concern about the dust that may be generated by the development. I accept that British Rail and the concrete companies say that the activity will be enclosed, the essential operation will be boxed in by protective layers and the process will be subject to dampening.
However, two factors must be borne in mind. First, no such plant has ever been built. There is not a concrete plant in this country with an enclosed operation and the damping-down facilities proposed by British Rail for the King's Cross site. The inspector's report identifies the problem and states that he cannot make a judgment on whether such mechanisms will work, because there is no such plant up and running for him to look at.
The second factor is that, if the protective devices are to work, there must be immaculate housekeeping at the site and everything must be done entirely by the book. From the moment they set foot on the site to the moment they leave, people must abide by the rules. I expect that, in the normal course of operations of a concrete batching plant, there will be quite a lot of hasty, perhaps understandable, breaches of the guidelines and rules. The necessity for closing doors and ensuring that everything is shut may be forgotten in haste. It may well be that the site will not be run absolutely according to the rulebook each and every day in each and every year. Therefore, there is a danger that dust will be created, with a serious impact on local people.

Mr. Waller: Does the hon. Gentleman accept that the concrete batching plant will be subject to the increasingly stringent regulations set out in the Environmental Protection Act 1990? The enforcement authority will be the London borough of Islington, which as an ultimate sanction could require the closure of the concrete batching plant if the regulations were not met. Will that not be a considerable incentive for everyone involved with the plant to ensure that the rules are obeyed?

Mr. Smith: I am sure that the excellent environmental health officers of the London borough of Islington will do everything possible to ensure that the site is operated in accordance with the rules and the commitments presently being given by British Rail. But what will happen when there is blisteringly hot weather in the summer and all the doors and hatches in the concrete batching plant, which are supposed to be kept shut, are open because of intolerable heat? One can fully understand how that might occur.
Roller shutters will be constantly opened and shut to allow access into and out of the various site facilities. Are we to say that no dust will ever escape when those shutters are raised or lowered? I would not accuse anyone of bad faith, but in the normal operation of such a site it will be impossible to maintain the absolute standards on dust that British Rail promises.

Mr. Corbyn: In response to the hon. Member for Keighley (Mr. Waller), my hon. Friend made an important point about the likely dust levels inside the plant. We are moving into uncharted waters here. Does my hon. Friend agree that Islington's excellent environmental health service will be put in an impossible bind? It will have to ensure reduced dust levels surrounding the plant while being required to look after the health, safety and welfare of those who work in the plant, where dust levels will be high. I wonder whether we are building a plant that will be a complete monster for all concerned.

Mr. Smith: My hon. Friend makes a valid point. One of my sadnesses is that the creation of the concrete batching plant will not provide any employment for local people —it is intended, probably rightly, to move the existing employees from the King's Cross site to this site—but their health and safety must be considered.
I have already touched on the problem of site noise. The site is directly next door to residential accommodation. Noise will come not simply from train deliveries and shunting operations but from lorries coming empty to the plant and leaving full from it. They will rev their engines in low gear and grind their gears coming up out of the low-lying site to reach the levels of the main roads surrounding the site. There will be many noisy operations on the site, such as the descaling of the revolving drums on the backs of the lorries. Local residents will have to put up with all that.
In addition, there will be the impact of train movements. People living in the surrounding area already experience considerable noise disturbance from the trains using the main-line tracks. The vibrations can be felt as far away as Hartham road, which is a considerable distance from the site. Although everyone in the area accepts that no one living in close proximity to a railway, as I do, can expect a wholly quiet, noise-free existence, they are entitled to ask questions about the extent of the additional noise which is likely to be imposed on them. We are talking here not just of inter-city trains or normal transport but of trains carrying extremely heavy materials on to the site.
There is an additional problem. Some houses in the immediately surrounding streets are already experiencing subsidence from the vibrations from the railway lines. Therefore, in addition to noise and disturbance, there may well be gradual structural damage to properties immediately beside the lines.
It is worth noting that only a few years ago British Rail sold land for housing, which is now known as the Heddington Grove estate. A year later, it deliberately set about preparing these proposals for a concrete batching plant and associated works that will make life a misery for those who live in those houses.

Mr. Michael Brown: I have a copy of the London county council planning and building regulation document of 22 January 1963—document TV51—which specifically designates the land for housing. There is absolutely no doubt that in those days the London county council architects department had information about the site from the principal housing architect:
Railway surplus lands, borough of Islington. Proposed use: housing.

Mr. Smith: The hon. Gentleman, who has done much more research into this matter than British Rail ever dreamed of, is right to draw particular attention to that.
In addition to the noise of train movements, traffic will be generated by the lorry movements into and out of the site. British Rail airily tells us in its environmental assessment that that will not affect residential roads. I am afraid that the planning inspector disagrees. He notes that the traffic generated by the concrete batching plant at Lough road would include a considerably higher proportion of heavy goods vehicles than would be generated by any other form of industrial development on the site. He accepts that point, which has been made forcefully by local people.
The inspector goes on to address the question of where the HGVs will go and what will happen to some residential streets. He lists those most likely to be affected as Mackenzie road, Hemingford road and North road, and adds that there will be others. All are residential streets. The inspector points out that they are reasonably wide residential streets. That does not mean that people do not live in them. In all those streets people living in houses and flats will face a massive increase in disturbance from traffic as a direct result of the plant. It is nonsense for British Rail to claim that there will be no impact on residential streets.
The direct access to the site will be from Caledonian road. At rush hours, it is extremely busy, with long queues of traffic stretching past the site. There are residents on Caledonian road, although it is a main traffic artery, and they, too, will be affected. Obviously, the traffic that at present uses the road—not necessarily HGVs—will try to find other ways of bypassing the extra traffic jams that will be created by the HGVs that will use the road as a result of the construction of the site.
Clearly, there will be a dramatic traffic impact on all the surrounding residential areas. It is high time that British Rail owned up to that fact. The additional traffic desperately worries many people who live in the surrounding area.
Other issues have to be addressed. There is the disruption to the flow of existing traffic that will be caused by some of the proposed railway works. I am sure that my hon. Friend the Member for Islington, North will want to say a little about the changes to the Hornsey road railway bridge which are proposed in the Bill and which affect his constituency.
I defy anyone to look at the before and after drawings of the Hornsey road railway bridge that are contained in

the environmental assessment published by British Rail and not be horrified at the proposed change to the Hornsey road bridge which forms the immediate sight line for all people walking or travelling up and down Hornsey road from Holloway road. That change will have a dramatic impact on the visual environment of the area.

Mr. Corbyn: My hon. Friend has obviously looked at the environmental impact notes published by British Rail. Does he agree that the Hornsey road bridge drawings are completely misleading and that it is about time somebody in British Rail learnt how to do three-dimensional drawings so that we can see the impact of the change? That would be a great step forward. At first glance, there appears to be no difference whatever.

Mr. Smith: Certainly there appears to be a difference. I suspect that in reality the difference would be far worse than what is already rather alarmingly portrayed in the documents.
In addition, a clause in the Bill abolishes rights of reverter in connection with the proposals. We all know what the Committee on the King's Cross Railways Bill said about the abolition of the rights of reverter. It was dubious about that concept in relation to the King's Cross Railways Bill. I suspect that any Committee that might conceivably be established if we were to give the Bill a Second Reading would wish to take a similarly sceptical attitude to the abolition of rights of reverter in the Bill.

Mr. Michael Brown: Is not the answer to the question posed by the hon. Member for Islington, North (Mr. Corbyn) contained in the language used by British Rail, which would be worthy of a good estate agent or even a bad one? Describing the new Hornsey road bridge, it says:
The current bridge comprises three brick arches and has some visual character.
There is no doubt that even British Rail is basically admitting that the bridge is rather attractive, but the next sentence gives the game away. It says:
The new bridge would be of a radically different design.
Does that not give the game away? Is that not, in estate agents' speak, basically admitting that the bridge will be a visual horror?

Mr. Smith: That is correct. A cursory glance at what is proposed in relation to the bridge, which is of considerable visual importance to the amenity of that area, will lead anyone to the conclusion that what British Rail proposes will be an absolute horror.

Mr. Cryer: Would my hon. Friend care to glance at the list of costs supplied with the Bill by the promoter, in which he will see that the bridge will cost just under £2 million? I can assure my hon. Friend that that would go a long way towards providing the rolling stock on the Leeds-Bradford electrification. That cannot be provided at the moment because the Industrial Bank of Scotland, which is arranging for the leasing—following the Government's insistence that the rolling stock should be leased—is saying that it wants a guarantee that, if the railway is privatised, the organisation that takes over the railway from the passenger transport authority will be able to pay for the leasing of the trains. Is it not a remarkable contrast that an important electrification scheme in the north is being placed in great difficulties because of that


bizarre leasing insistence by the Government, yet British Rail is prepared to spend almost £6 million on something that is unnecessary?

Mr. Smith: My hon. Friend correctly identifies the overall cost of the works in the Bill of some £5.5 million, a high proportion of which relates to the Hornsey road railway bridge. Is it not barmy that here we have a proposal which will do no one any good, which is not material to the King's Cross main proposal for a channel tunnel station, which will do enormous damage to the lives of people in the immediate area and which no one in that immediate area wants, yet it is gobbling up £5.5 million which could much better be spent on other railway improvements, the purchase of rolling stock and such like, for which people are crying out in other parts of the country? One must seriously ask whether British Rail has its priorities right.

Mr. Cryer: My hon. Friend mentioned investment. I assure him that, if the rolling stock programme for the Leeds-Bradford electrification—

Mr. Deputy Speaker (Mr. Michael Morris): Order. The Leeds-Bradford line is not included in the Bill. I allowed the hon. Gentleman to develop his initial intervention, but I hope that we can return to either the siting of the concreting plant or the passenger terminal.

Mr. Cryer: On a point of order, Mr. Deputy Speaker. There is with the Bill a list of expenditure amounting to £5,342,000 and I should have thought that it was legitimate to show where that money could be better spent as an example of the way in which costs are incurrred by the Bill.

Mr. Deputy Speaker: The hon. Gentleman has already given one example and appeared to be repeating it.

Mr. Smith: I am sure that my hon. Friend is simply seeking to assist the House in setting our discussions in an appropriate context.
I know that you, Mr. Deputy Speaker, are fond of and know well the streets and estates of Islington. You will, I suspect, share my horror at the Bill. I stress—this is an extremely important point to remind hon. Members, especially my hon. Friends, of—that the Bill has virtually nothing to do with the channel tunnel station at King's Cross and the onward use of that station for links to the north-east and the north-west. The minor matters of access points could easily be dealt with elsewhere.

Mr. John Gunnell: In the past 75 minutes, my hon. Friend has spoken mainly about planning issues, which I assume were fully considered by the planning inspector at the inquiry. Were the points that my hon. Friend has made now at such length made at the planning inquiry and did the inspector address the remarks made by my hon. Friend and my hon. Friend the Member for Islington, North (Mr. Corbyn), who represent the borough of Islington?

Mr. Smith: I made representations to the inquiry. I did not say as much as I have said in the House, but some of what I have said tonight I also said to the inquiry.
If the Bill did not proceed tonight, the main King's Cross proposal would not be damaged or delayed in any way. If it is passed, the Bill will lead to the establishment of a concrete batching plant which is fiercely opposed and

resisted by local people. The plant is not needed at the proposed location in any event, because alternatives exist. At times, it will generate dust, fumes, noise and disruption for people living nearby. It will result in train movement that will disturb and distress those people. It will generate damaging traffic impacts in the surrounding residential streets.
Much of the Bill deals with the protection of highway authorities, undertakers, telecommunications services and water authorities, but it contains nothing about the protection of local residents. It must not be assumed that, just because the local residents live in an inner-city area, they should be forced to put up with what no one else would endure. They are being asked to put up with work going on just beneath their windows, throughout the day and possibly at night. I believe that their interests should be taken into account, and I am here to represent them. Because I know what they think, I believe that the House should refuse point blank to give the Bill a Second Reading.

Mr. Jeremy Corbyn: I oppose the Bill, and I ask the House to consider seriously what has been said by my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith). Most of the works envisaged in the Bill would take place in his constituency: as I said in an intervention, the constituency boundary lies on the Holloway road, and the northern part of the scheme falls within the Islington, North constituency—that is, the works around the Hornsey road bridge and the new line that links up with the main line near Finsbury park.
My hon. Friend's last point was important. I am sorry that my hon. Friend the Member for West Bromwich, East (Mr. Snape) is not in the Chamber now. He said that there was already a good deal of noise and disturbance in the borough of Islington. That is true. Islington is an inner-city area, and a good deal of road and railway traffic goes through it. We know that because we live there and have to suffer it. Over the years, however, efforts have been made to reduce the number of heavy vehicles driving through the borough, with some success—I refer particularly to the night-time lorry ban—and conditions have improved slightly.
It is ridiculous to suggest that, because there is already a lower standard of life than there should be in an inner-city area, the establishment of a concrete batching plant there does not matter. Does that mean that people living in an area of poor environmental quality must be consigned to live permanently in an area of ever-decreasing environmental quality? That surely is not the function of the Bill, the House or individual Members of Parliament.
Would Members of Parliament want a concrete batching plant to be established in their constituencies alongside a new housing development? Would they want British Rail, by sleight of hand, to sell the housing development land to people who moved in on the basis that they were moving into a residential area, and that further housing would be built? That is what the land search would have revealed, as was pointed out earlier by the hon. Member for Brigg and Cleethorpes (Mr. Brown). British Rail has behaved very unfairly.
British Rail is very good at lobbying tactics. It spends an awful lot of money and time on such tactics, and it has


managed to convince a good many hon. Members that only the narrow self-interest of a few London Members prevents it from establishing direct links with the channel tunnel ports and route. That is complete nonsense. During the debate on the King's Cross Railways (No. 1) Bill, it was clear that some hon. Members honestly believed that freight traffic would go through King's Cross, and that our opposition to the terminal that the Bill proposed would somehow prevent industrial development in the northeast, north-west, Scotland and Wales. That is utter and complete nonsense. Fortunately, my hon. Friend was able to expose it for what it was.
British Rail now suggests that, if the concrete batching plant cannot be put in Lough road, the opportunity to revitalise the British economy by means of the channel tunnel connection with Europe will be lost and that that will be due to the selfishness of a few residents who live alongside the proposed concrete batching plant site in that road. It is about time that British Rail was called to account for its lobbying methods and its misinformation.
My constituency includes Monnery road, the previously proposed site for the concrete batching plant that was referred to by my hon. Friend. Reference was also made to it in the inspector's report. We were told exactly the same story—that unless the Monnery road residents were prepared to put up with a concrete batching plant alongside their homes, vast lorry movements each day, the delivery at night of aggregates and all the dust that goes with it, they would be responsible for the failure of the King's Cross enterprise. That was complete and utter bunkum. Their campaign, in which I was delighted to play a part, was successful. They persuaded the inspector not to grant permission for the use of that site. Unfortunately, Willment Ready Mix Concrete and the other company have moved down the road and are trying to develop the Lough road site.
I do not believe that serious consideration has ever been given to finding alternative sites. British Rail is keen to move the concrete batching plant away from its existing site because land values north of King's Cross for office development are potentially higher than the value of disused railway land around Lough road. We are expected to welcome this concrete batching plant into the borough of Islington because money can be made out of the sale of the existing site.

Mr. Cryer: Does my hon. Friend agree that this is not entirely British Rail's fault? Is it not largely the Government's fault through imposing financial restrictions on British Rail that force it to look at every means of obtaining revenue from selling off its land? Obviously it favours selling off the most valuable land areas—hence British Rail's promotion of the Bill. If the Government provided adequate investment for British Rail, the Bill would be unnecessary.

Mr. Corbyn: My hon. Friend has made a very good point. He made a similar point on previous occasions, and he was right to do so. I share his general support and enthusiasm for railways and for rail transport in general, believing it to be more environmentally friendly than road transport and also believing it to be the proper way to develop this country's infrastructure.

Mr. Gunnell: Except in Islington.

Mr. Corbyn: No, my hon. Friend is entirely wrong. I am not opposed to the development of the railway infrastructure in Islington, nor is my hon. Friend the Member for Islington, South and Finsbury. We spend a great deal of time encouraging people to use the railways in our borough because we suffer the consequences of selfish motorists driving in and out of London, polluting our atmosphere, when they should be travelling by train. We are talking here about an industrial development taking place in a residential area because British Rail has been told by the Government to maximise its income from the sale of its land around King's Cross site. To suggest, as I am sure my hon. Friend did not intend to do, that we are putting forward a "not in my back yard" scenario is simply not true. What we are asking the House to consider is whether it makes good sense to put the concrete batching plant on the proposed site.
My hon. Friend the Member for Islington, South and Finsbury referred in his speech to the problem of the dust created in the area surrounding the proposed concrete batching plant. It is a very serious issue. Wherever a concrete batching plant may be sited and however well it may be managed, it will produce a lot of dust, for those who live in the area, for those who work in the area, or for those who live in the roads along which the concrete is subsequently delivered. They may also be affected by the slurry that is dropped on the roads, which subsequently dries out.
Background dust levels throughout inner London are excessively high. We are conducting studies into the increase in childhood asthma and respiratory illnesses in inner London areas. The results are startling and frightening. I suggest that those who adopt a rather cavalier approach and say that one can resolve the dust problem by encasing the building in a steel shell should think again, because the dust is carried beyond the building. As I said in an intervention on my hon. Friend the Member for Islington, South and Finsbury—and I think that he agreed—even if one were to encase the building in a steel shell as proposed, there will be occasions when shutters must be opened or closed to allow the trains or lorries in or out.
Another problem is the likely high levels of dust within the plant, making it extremely dangerous for those who work there. We should think more about the health and safety of everyone involved. If the plant is on a restricted site as proposed, it will be difficult to solve the dust problem.
In his report, which was sent to the Department of the Environment at the end of the inquiry in May this year, the inspector examines in detail the dust problem in a case made by the London borough of Islington. He states that concrete batching is now a prescribed process under the Environmental Protection Act 1990 and that these plants will require authorisation from the council under that Act. Under this procedure, the council will be able to ensure that the best available technique not entailing excessive cost is used. It is accepted that the appellants are likely to meet acceptable standards.
That is true, because they are so vague. He goes on to deal with the
serious problems of increasing dust levels all around this particular plant if the construction goes ahead.
I ask those supporting the proposal to think seriously about the dust problems that are likely to accompany it.
I believe that the Lough road site was chosen merely because it happens to be there—for no greater or lesser reason than that. It happens to be there and happens to be a convenient piece of land which British Rail finds that it can use. In our consideration of the Bill, I should have thought that we would first consider the sanity of moving the plant at all. As I said, I think that the move is motivated largely by the potential land value gains that could be made by moving the site from the King's Cross area.
Secondly, we should consider the danger of the site's proximity to existing housing, schools and churches. It is a residential area, and any hon. Member who has been involved in campaigns to try to improve the environment and look after his constituents must be aware of the strength of feeling that goes with opposition to such a plant. Although the inspector's report does not always draw the conclusions that some of us would wish, it at least recognises the strength of feeling.
As my hon. Friend the Member for Islington, South and Finsbury asked, are the children who live in the area to sit in a school where the windows cannot be opened? Who is to clean the windows every day to ensure that sunlight gets in when the dust flies around in the dry heat of summer, as already happens? 
There will also be increasing traffic movements in the area. It is proposed that there will be three train movements a day running down the new line to deliver the aggregate to the plant itself. There will also be a large number of lorries leaving the site throughout the day. Those lorries filled with wet concrete will have two hours at the most to reach their destinations. In some cases, contractors demand one-hour delivery times.
It is already a heavily trafficked part of London. Most roads in the borough run north to south. Like most roads in north London they are routes in and out of central London. There is increasing pressure on the borough from people trying to use it as a bypass to the City through the Marylebone road, which means more pressure on east-west roads.
A considerable amount of work has been done on the borough's roads—width restriction, road humps and other measures—to try to reduce the amount of heavy goods vehicles using the side roads. If the plant goes ahead, I predict that there will be far more pressure to prevent heavy goods vehicles using residential roads. Such proposals are usually opposed by the emergency services, in some cases for understandable reasons. In turn, that generates greater traffic on the remaining main roads, greater congestion and greater difficulty in delivering the concrete within the one or two hours prescribed.
The construction of the Holloway relief road which accompanies the proposal will increase traffic along the Hornsey road and across the Holloway road. I believe that it will become something of an alternative route into central London. Many of us do not want that. We do not believe that the future of the city lies in increasing road traffic by constructing such roads. The construction of the road is a by-product of the building of the concrete batching plant.

Mr. Waller: I must correct the hon. Gentleman. The London borough of Islington gave itself permission to construct the Holloway access road before the planning inquiry, and it objected to the proposal for the Lough road site. Bearing in mind the fact that the Holloway access

road will generate more continual noise than anyone expects from the concrete batching plant, I wonder whether the hon. Members for the two Islington constituencies objected to the borough's giving itself permission to construct the road.

Mr. Corbyn: I have never favoured the construction of that relief road, because of the increase in traffic that it would bring in London. In general, I am against the construction of new roads in London, because they simply increase the traffic problem. We must look for a public transport solution to London's problems. The hon. Gentleman's question does not present me with a difficulty.
Although the council has granted itself permission for the construction of the road, the finances are not available, whereas part of the money involved in the construction of the concrete batching plant will be spent on the construction of that road—unless I am sadly mistaken, in which case the hon. Member for Keighley (Mr. Waller) or my hon. Friend the Member for Islington, South and Finsbury will quickly correct me.
Page 24 of volume II of the environmental statement gives existing noise levels for nearby residential users. Later, the same document estimates likely noise levels if the proposed works go ahead. I am in no position to challenge the figures or the method used to produce them, but I believe that there will be an increase in noise for people living in tower blocks on the Harvest estate—the large estate to the north of the Holloway road, which contains 18-storey tower blocks. Those people already suffer considerable noise from both roads and railways. The roads immediately surrounding Hornsey road—Annette road, and others—will suffer increased noise, as will the roads immediately surrounding the plant in the constituency of my hon. Friend the Member for Islington, South and Finsbury.
Expensive works are also proposed involving the building of a new railway on existing track bed north of the Holloway road to link with the main line nearer to Finsbury park. A new bridge is to be constructed over the Hornsey road and the Holloway road, using bridge buttresses, which remain although the bridges were demolished years ago by British Rail. It seems short-sighted to demolish a bridge and subsequently have to rebuild it at considerable cost.
The designs and drawings in the environmental statement are misleading. My intervention in the speech by my hon. Friend the Member for Islington, South and Finsbury may have been misunderstood. I was trying to say that the drawings pretended to show that there was not much difference in design between the existing bridge and the proposed new bridge span, whereas the result will be an ugly bridge span built at considerable cost which will cause great disruption during its construction. With the amount of money involved, and the kind of construction methods available, I should have thought that BR would at least recognise that it could do something better and more imaginative.
Perhaps the hon. Member for Keighley will be able to help me on my next point when he replies to the debate. At the moment there are many small industrial premises under the arches of the line to the north of the Holloway road around Hornsey road. I know many of the people who work in them and operate small businesses from them. Some years ago there was an attempt massively to


increase rents, which would have put most of them out of business. But most have survived by a process of negotiation and campaigning—and in some cases rents have changed. I am not sure what effect there will be on these industrial operations during the construction. Will they be able to remain after the construction of the new line and bridge? They are important employers, and they provide opportunities for small businesses to operate in the area.
Once again we are examining a Bill to do with King's Cross, even though we have been through lengthy processes of a similar sort in the past two Parliaments. Many of us have been unhappy about the planning procedures and the costs involved, not to mention the time taken up. British Rail has always tried to pretend that every obstacle put in the way of its grand design for King's Cross is a deliberate attempt to destroy the whole initiative.
My hon. Friend the Member for Islington, South and Finsbury rightly concluded by saying that there is a world of difference between the construction of the King's Cross terminals and the location of the concrete batching plant. The proposals in the Bill are wholly unreasonable. If British Rail puts this plant in a wrong area such as ours, it will create dust and noise, it will increase traffic in the area and it will greatly damage the environment and health of local people.
We who live in inner cities do so because we want to—because we like them. That does not mean that we like the noise and pollution that go with them. It is not right or fair that plants such as this should be put on inappropriate sites, to the detriment of the environment. The many people from the community who gave evidence to both the Monnery road and Lough road inquiries conclusively showed their concern and their determination to improve their neighbourhoods.
This evening hon. Members will have heard what we who represent the borough have to say and I hope that they will recognise that our points are valid. British Rail has not made the case for locating the concrete plant where it wants it. The Bill should proceed no further. There should be a serious examination of the need to move the plant; of alternative sites for the plant; and of the adequacy of the site proposed, with its attendant dust and noise problems. Finally, we should also look into the likely requirement in future for ready-mixed concrete. Unfortunately there is a slump in the construction industry. London is blessed with a 25 per cent. surplus of office space which is likely to worsen if more office building goes ahead. I am sad to say that there is no major house building exercise because local authorities are denied the funds with which to undertake one.
One wonders whom the whole enterprise is designed to serve. Instead of a concrete batching plant on the site we should like something more useful in line with what local residents have suggested. Perhaps efforts should be made to solve the appalling housing problem faced by people in our borough and throughout inner London. The site was originally earmarked for housing and that is what it should be used for. That would go some way to providing decent housing for people who are homeless or sleeping on the streets, for the concealed homeless who have to share with others, and for those who live with small children on the

top floors of tower blocks. They deserve a better chance in life, and this is a small opportunity to improve the lot of a few people.
By contrast, the option represented by the Bill would damage the lives of a large number of people, which is why I ask the House to reject it.

The Minister for Transport in London (Mr. Steve Norris): I should like to take this brief opportunity to outline the Government's view of the Bill and to acknowledge the efforts of my hon. Friend the Member for Keighley (Mr. Waller), whose opening remarks admirably set the scene for the debate and whose subsequent interventions showed his mastery of his brief.
It would be churlish of me not to acknowledge also the conscientious, as ever, defence of constituency interests mounted by my hon. Friend—if I may so call him—the Member for Islington, South and Finsbury (Mr. Smith) and by his colleague the hon. Member for Islington, North (Mr. Corbyn). I noted too a number of pertinent interventions by my hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown). Perhaps he will catch the Chair's eye at some future point and say more. I also acknowledge the contribution of the hon. Member for West Bromwich, East (Mr. Snape), whose interventions were as constructive and helpful as ever. I hope that that does not damage the hon. Gentleman's reputation any more than is reasonable, although, at this time of night, it is probably not too dangerous a compliment to pay him.
As my hon. Friend the Member for Keighley has explained, the works in the Bill are related to those in the King's Cross Railways Bill which is currently before a Select Committee in another place. The Government reaffirmed in the Second Reading debate on 1 June their belief that King's Cross is the best location for the London terminus of the proposed rail link. We believe that King's Cross would be the most efficient interchange for international passengers seeking to travel on beyond London and for domestic passengers seeking to travel to central London.
Given that the works form a necessary part of the project which has already been endorsed by the House and passed to another place for consideration, it seems only equitable and sensible that the Bill should be allowed to proceed to Select Committee stage for detailed consideration.

Mr. Chris Smith: rose—

Mr. Norris: Before the hon. Gentleman intervenes, perhaps he will allow me to suggest that a number of the detailed points that he raised might be more appropriately considered in the Bill's later stages.

Mr. Smith: The Minister said that the works in the Bill were "a necessary part" of the King's Cross project. They are nothing of the sort. Some of the works, such as the access points, are related to the main project, but the concrete batching plant and the railway link to it have nothing whatsoever to do with the main King's Cross project. I hope that the Minister will acknowledge that.

Mr. Norris: I hear what the hon. Gentleman says about the inevitability or otherwise of the link between the two Bills. I reaffirm the Government's view that the works in the No. 2 Bill form a necessary part of the project. I note


in passing that, although my right hon. Friend the Secretary of State granted permission for the plant following appeal, and although as such it does not fall within the private Bill procedure, a Bill is required for the railway lines that will enable the project to be joined to the east coast main line and thus allow the concrete to be transported by rail rather than by road. No doubt the hon. Member for Islington, South and Finsbury would broadly welcome that, subject to the reservations that he has outlined.
It is not my place or that of the Government on occasions such as this to argue the merits or demerits of the Bill. I simply intervene to suggest the Government's overall attitude to the Bill. As I said earlier, it is clearly appropriate that the detailed points raised by the hon. Members who have contributed to our debate should be raised in later stages with the Committee. I therefore commend the Bill to the House, and ask that it be allowed to proceed in the usual way to Committee for more detailed consideration.

Mr. Peter Snape: As the Minister has just explained, the Government and the Opposition do not officially take a position on legislation such as this. I have listened to the debate on the King's Cross Railways (No. 2) Bill and I have listened to the debates on earlier King's Cross Railways Bills. I congratulate my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) on his detailed knowledge and constructive arguments against the proposal. I cannot really congratulate him on his brevity, because I am sure that irony is not permitted under the rules of the House. However, my hon. Friend made some detailed objections on behalf of the people he represents, as did my hon. Friend the Member for Islington, North (Mr. Corbyn).
The long technical summary provided by British Rail points out that the two concrete batching plants—

Mr. Michael Brown: rose—

Mr. Snape: I will refer to the hon. Member for Brigg and Cleethorpes (Mr. Brown) in a moment, because I want to break the habit of a lifetime and comment on a speech before I have heard it. If the hon. Gentleman will contain himself for a moment, I will get round to him.
The non-technical summary refers to the two concrete batching plants to be displaced by the King's Cross Railways Bill works. That appears to me to provide some justification for the label "King's Cross Railways (No. 2) Bill" to be attached to the measure, but I do not suppose that I will convince either of my hon. Friends that such is the case.
I was interested to hear my hon. Friend the Member for Islington, South and Finsbury point out an alternative site for the batching plant south of the river. There was one advantage and one disadvantage to that alternative. The advantage from my hon. Friend's point of view is that the site at New Cross was not in his constituency. The disadvantage is that siting the concrete batching plant south of the river would generate even more heavy goods vehicle movements in the City of London and around this building, too. I do not say that our environment is more worthy of protection than that of my hon. Friends' constituents, but if we are to fulfil our party's objective of

ensuring that as much traffic as possible, particularly heavy freight traffic, is carried by rail, we must accept that meeting that objective is likely to cause some dislocation to the lives of many of our constituents.
The argument about the dislocation to lives caused by railway marshalling yards and railway facilities is not unfamiliar. I remind my hon. Friends that bordering my constituency, a seat that is slightly more marginal than those of my two hon. Friends, is the Bescot marshalling yard. Proposals to expand the railway facilities there meet considerable local opposition. It might underline my hon. Friends' view of my foolhardiness when I say that I have always supported such proposals because I believe that our party's objective of moving traffic from road to rail should not only be shared in someone else's constituency but adopted in our own constituencies.
Although I appreciate my hon. Friends' concern on behalf of their constituents, some of us who represent constituencies in the midlands and in the north of England would be glad of the opportunity to complain about the noise from industrial premises. Industrial premises in our constituencies are all too often deserted and derelict. The fact that the placing of industrial premises in constituencies such as Islington, South and Finsbury causes some local concern, which is rightly reflected in my hon. Friends' contributions, should not alter the fact that some of us would welcome facing the sort of problems about which my hon. Friends have complained.
I now refer, before he has even opened his mouth to make it, to the speech of the hon. Member for Brigg and Cleethorpes. The hon. Gentleman has the Adjournment debate tonight. [Interruption.] If he has not noticed, I am sure that he will have it drawn to his attention. I promise not to stay for it, if that is any consolation. However, the hon. Gentleman has the Adjournment debate on the InterCity service to and from Cleethorpes. I understand his natural concern that British Rail should see fit to withdraw the one through train a day to that part of the world.
We faced a similar problem with InterCity services from Wolverhampton to Shrewsbury. The hon. Gentleman will be aware, because he takes an interest in such matters countrywide, that the InterCity service from Wolverhampton to Shrewsbury has been cut because BR says, as it says about the Cleethorpes service, that it does not pay and that InterCity is charged with running a profitable service. In the words of the former chairman of British Rail, Sir Bob Reid mark I, "Our job is to run a service which is profitable, not one that is desirable." The hon. Gentleman does not share that view in respect of his own constituency and regional interest.
I notice that BR has said that the objectives that were set by the Secretary of State for InterCity services in the United Kingdom have been considerably tightened of late. In 1988, the objective was to achieve a 2.7 per cent. rate of return on assets. InterCity achieved a 1.3 per cent. rate of return in 1988–89—a profit of £26 million.
In 1992–93, the objective is 4.75 per cent. rate of return—a profit of £95 million—despite the recession. I look forward to seeing the hon. Member for Brigg and Cleethorpes participate in all rail debates in future attacking his own Secretary of State, refusing to support his Government and giving the Government Whip nightmares. I hope that he will pass up any opportunity of


promotion to attack the objectives that his Government have set, which have a severe impact on the InterCity service to his constituency.
The hon. Member for Brigg and Cleethorpes cannot have it both ways. Either he supports the tightening of the financial belt on InterCity, and in doing so accepts that on any measure of profitability the one through-train to Cleethorpes, desirable as it might be, is a non-starter—

Mr. Deputy Speaker: Order. It may or may not be desirable, but that is for the Adjournment debate. Will the hon. Gentleman return to the King's Cross Railways (No. 2) Bill?

Mr. Snape: I am sorry, Mr. Deputy Speaker. I have said enough, and I am grateful to you for your guidance and for your kindness in allowing me to say what I have said already. Now that the hon. Member for Brigg and Cleethorpes knows what is in order and what is not, I know that he will be careful to avoid falling foul of your justified strictures.
I shall vote for the Bill, even though I appreciate the difficulty that it causes some of my hon. Friends. I believe that the objectives inherent in the Bill are ones that Opposition Members should support.

Mr. John Heppell: When I was elected to Parliament, I thought that I would get away from planning matters, and I breathed a sigh of relief. But I have been thrown back among planning matters again. However, there is a great difference. I could have started off like the hon. Member for Bradford, South (Mr. Cryer) by expressing my disappointment that British Rail's proposals do not contain a stop for Nottingham to provide a through route via King's Cross to the channel tunnel. I am disappointed about that because I recognise that the channel tunnel will bring extra prosperity to Britain and that the prosperity will follow the lines of communication. The prosperity will come to where the railway runs, so I am disappointed that Nottingham is not part of that line.
If the Bill fails, Nottingham will certainly never have a link with the channel tunnel. If the Bill is passed, there is a possibility that Nottingham will have that link. I believe that if the No. 2 Bill fails, the first Bill will fail. Nothing that my hon. Friends the Members for Islington, North (Mr. Corbyn) or for Islington, South and Finsbury (Mr. Smith) have said persuades me otherwise.
My hon. Friend the Member for Islington, South and Finsbury says that 95 per cent. of the Bill has nothing to do with the original King's Cross Railways Bill. I accept that. My problem is: what about the 5 per cent. that has something to do with the original Bill? If 5, 4, 3, 2 or 1 per cent. is necessary for the Bill to be passed, I have a duty to support the No. 2 Bill.
I understand the fears of my hon. Friends the Members for Islington, North and for Islington, South and Finsbury. They made a valiant attempt to defend their constituents. They somewhat gilded the lilly. They used some ingenious arguments. If I had more time—I recognise the pressure of time, Mr. Deputy Speaker—I could pick apart their arguments. There was an element of "not in my backyard" in their arguments, but I recognise

that there are genuine fears among their constituents. My hon. Friends should express those fears. They have every right to do so.
I represent Nottingham. The area that I represent, Nottingham, East, has some of the worst unemployment figures and some of the worst bankruptcy rates in the country. One of my wards has 40 per cent. Overall unemployment and male unemployment is much higher.
I recognise the unemployment problems faced by the hon. Member for Islington, North, but I cannot return to Nottingham, East and tell people that I have thrown away a chance to give them extra prosperity because of what is happening in Islington.
If I vote against the Bill and it falls, the King's Cross Railways Bill will fall, and then we shall effectively strengthen the north-south divide. In Nottingham, we would like a share of channel tunnel prosperity. Why should that stop at London and the south-east? My views will be those expressed by the majority of hon. Members in the north and in the midlands.

Mr. John Gunnell: Some of my comments will be similar to those made by my hon. Friend the Member for Nottingham, East (Mr. Heppell). I listened with considerable interest to my hon. Friends the Members for Islington, North (Mr. Corbyn) and for Islington, South and Finsbury (Mr. Smith), who put up a spirited defence of what they think of as their constituents' interests. I was interested to find that my hon. Friend the Member for Islington, South and Finsbury participated in the planning process, at the end of which the planning inspector arrived at a conclusion. Had he come to a different conclusion, I imagine that the Bill before us would have been different.
My hon. Friend drew attention to the fact that for several years I have commented, outside the House, on the channel tunnel and direct links between it and the north of England. Those links depend critically on a King's Cross terminal. Therefore, in the past eight years—not merely during the four years that the matter has been before the House—I have been active in trying to ensure that those links are in place and have supported the King's Cross project.
I accept that my interest is in one sense strategic. I am interested in the strategic issues through which we may ensure that the channel tunnel serves the nation and not merely the south-east, and that it provides connections between the single European market and the northern industrial regions.
While my hon. Friends who represent Islington have to consider the needs of the people there, and especially of those people near the site where the concrete plant is to be relocated, I have campaigned on behalf of the northern region, and have been dealing with the needs of 17 million people and with the economy that affects them. I must set that and its 5 per cent. of the Bill against the 95 per cent. of the Bill that my hon. Friends who represent Islington are talking about.

Mr. Chris Smith: I have followed what my hon. Friend has said and also the speech of my hon. Friend the Member for Nottingham, East (Mr. Heppell). Their arguments depend entirely on a presumption that, if the access points included within the Bill for the main King's Cross site are not given the go-ahead, the site, the project


and thereby the link to Nottingham, Leeds and the north cannot proceed. That is an incorrect assumption. Access points in the King's Cross Railways Bill provide perfectly well for access to the site. This Bill is an attempt to improve access and is not essential for the rest of the project to go ahead.

Mr. Gunnell: I am also worried about the time scale involved in the realisation of the King's Cross project. Improved access points appear to me to affect the time scale. One of my concerns has been the way in which the timing of the project has slipped back further and further. Therefore, there is no value in delaying the Second Reading.
The objections raised by my hon. Friends the Members for Islington, South and Finsbury and for Islington, North should be discussed. But they were considered by the planning inquiry and conclusions were reached. The best place for such arguments to be considered here is in Committee, when the 16 petitions that have been received can be examined in detail. The residents who live near to the plant, who submitted those petitions, would then be able to express their anxieties to hon. Members. There is no reason for further delay, because the north needs the transport links to be in place as soon as possible after the tunnel is completed.
My hon. Friend the Member for Bradford, South (Mr. Cryer) raised a different objection. He was dissatisfied with British Rail's plans for the use of the line and its provision of service to the tunnel. He will know that I am equally dissatisfied with the proposals that British Rail has produced after many years of lobbying. British Rail's planned services are not adequate for any of the northern regions, and in particular Yorkshire and Humberside. It will provide no service at all to west Yorkshire. I agree with my hon. Friend that the proposed links are highly unsatisfactory, but that does not mean that we should stop the Bill's progress at this point.
I shall continue to argue with British Rail about the development of the line and the provision of the correct rolling stock. But we will not even need that rolling stock if the right links are not in place.

Mr. Cryer: Does my hon. Friend agree that if we do not argue but accept everything that British Rail proposes, it will run right over us without giving us any concessions at all? In the negotiations, it is important that we hold some cards on our side.

Mr. Gunnell: I have talked to British Rail, to Bob Reid version one and Bob Reid version two, and a whole host of people about the King's Cross development. We must resist British Rail's attempts to put a block on the provision of services to the north. However, there is a difference between arguing for greater investment by British Rail and taking steps which will lead to unreasonable delays in the King's Cross project. The project has enough problems already.
British Rail's future is surrounded by uncertainty. This project will cost at least £1.4 billion, and if that sum must be obtained primarily from the private sector, which is the present view, I worry whether the project will obtain the money and be completed in the time scale that the north of England needs. The project should be completed. Money should be provided from public funds because it is a national responsibility to ensure that national links are in place for the channel tunnel.
If we are to allow the project to have the maximum chance to succeed, we must ensure that the Bill goes to Committee stage so that hon. Member's objections can be considered in detail.

Mr. Michael Brown: I take issue with the hon. Member for Morley and Leeds, South (Mr. Gunnell). We have both represented our local authority in one guise or another. Before he entered the House, the hon. Gentleman was a distinguished member of the local authority and, subsequently, an active director of the Yorkshire and Humberside development association. Therefore, the hon. Gentleman may wonder why I take issue with him, because he may argue that, to some extent, our interests are the same.
I have long been uneasy about the King's Cross development. When the original Bill came before the House in 1988, I had misgivings.
The hon. Member for Islington, South and Finsbury (Mr. Smith) took issue with me on whether the project should be dealt with by public inquiry or private Bill. I make no apology for saying that I accept that the private Bill procedure is the correct way for such a project to come before the House. In the 13 years in which I have been a Member of this House, I have taken a close interest in private Bills. I have opposed and promoted them, and I must therefore take the rough with the smooth. Private Bills give hon. Members an opportunity to probe organisations like British Rail much more closely.
The hon. Member for Islington, South and Finsbury is right to discuss his grave misgivings about the project. Hon. Members may ask what someone representing Brigg and Cleethorpes knows about King's Cross. For the past 22 years, since I first went to York university, I have been travelling from King's Cross to York, Scunthorpe or Cleethorpes by rail and I have spent more hours than I care to remember standing on the platforms at King's Cross waiting for a train to one of those three destinations. I hope that I shall have many opportunities in the future to stand on that platform waiting for the 7.50 train. Although the train is often delayed and I am stuck there for an hour or two, it will eventually get me all the way to Cleethorpes. I know a lot about King's Cross because the train is often delayed for more than an hour and 1 take the opportunity to go round the area.
I am particularly familiar with the Golden Lion public house. My hon. Friend the Member for Keighley (Mr. Waller) said that he thinks that British Rail will be able to accommodate the problems with regard to that pub, but I am not sure that that is true. The hon. Member for West Bromwich, East (Mr. Snape) quoted only from the non-technical report, whereas those of us who take a close interest in the Bill have referred throughout the debate to the technical report. In that report, British Rail makes it clear that the public house will have to be destroyed. I am delighted to hear from my hon. Friend the Member for Keighley that that has now been changed.
However, whether British Rail comes to the House with private legislation or whether it makes assurances in correspondence, it says one thing one year and then stands on its head and swears blindly that it did not mean it. I shall not share my correspondence with the House now but I shall do so in a couple of hours. When I told British Rail in 1988 that I would oppose the original King's Cross


Bill unless I received certain assurances, I was given those assurances on paper. But today, British Rail will say that the position has changed. Its assurances are not worth the paper on which they are written—

Mr. Tony Banks: They are like party political manifestos.

Mr. Brown: That comment is rather near the mark.
British Rail will say anything to get us into the Division Lobbies on private legislation. I have correspondence between myself and British Rail dating back to 1988, when the original King's Cross Bill was introduced, seeking assurances before I was prepared to support the Bill. Today, those assurances are not worth the paper on which they were written.
When my hon. Friend the Member for Keighley assures hon. Members that they need not worry about the Golden Lion public house because, although the technical report says that it will be destroyed, that is not so, I prefer to rely on the judgment of one of the petitioners, the Camden Civic Society, which has existed for a long time. It is described in its petition as a local amenity society, founded in 1963, and is affiliated to the Civic Trust. It has been dealing with British Rail over King's Cross for a long time—more than 28 years. It has met regularly with British Rail and played an active part in monitoring planning developments in the district around King's Cross, particularly in heightening public awareness of its buildings and environment.
In 1988, when the original King's Cross Bill was introduced, Camden Civic Society took the initiative, with officers of the London borough of Camden, in establishing a conservation area advisory committee for the King's Cross district, on the lines set out in the Department of the Environment circular produced in August 1987.
The organisation has met regularly since then and has played an important role in discussions on the district's future. It had no hesitation in saying that the Bill would require the destruction of the Golden Lion public house. It says that the pub is a distinctive building. I have frequently visited the pub when I have been at a loose end waiting for a British Rail train to take me to Cleethorpes, and I agree. I believe that it is also an attractive building in the context of an inner-city environment. It is part of the character of what Camden Civic Society describes as the King's Cross conservation area.
The hon. Member for Islington, South and Finsbury mentioned another building, but I think that he could have done it more justice. The Bill's proposals would involve demolishing the St. Pancras ironworks building—situated at 36-40 York way—which could otherwise be preserved. The hon. Member for Islington, South and Finsbury is right to say that there is an alternative.
I have been brought up on the lexicon that there is no alternative with regard to other political matters, but when it came to the issue of nuclear waste in Brigg and Cleethorpes, I proved that there was an alternative. The hon. Gentleman can take heart from the fact that I was told that there was no alternative but to have nuclear waste in my constituency as there was nowhere else for it to go. But miraculously, just one week before the 1987 general election was called, the proposal disappeared.
It is absolutely vital that hon. Members should be wary when an organisation such as British Rail seeks powers and claims that the project at King's Cross will fall unless there is a concrete batching plant at Lough road. They must be cautious if British Rail says that the King's Cross project for links between the north of England and Nottingham, through to the channel tunnel, will fall apart if the three temporary access points proposed in the Bill are not granted.
Hon. Members are being made fools of, and taken for a ride by British Rail, if they believe that in two or three years time when they have a constituency problem involving British Rail, they can remind it that they supported it over a controversial Bill and expect it to give them similar support. They can forget that idea—I went through that experience four years ago. I know exactly what hon. Members are in for if they believe the assurances given them by British Rail.

Mr. Waller: rose in his place and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 169, Noes 40.

Division No. 35]
[10 pm


AYES


Adley, Robert
Eggar, Tim


Aitken, Jonathan
Elletson, Harold


Arbuthnot, James
Evans, Jonathan (Brecon)


Arnold, Jacques (Gravesham)
Evans, Nigel (Ribble Valley)


Arnold, Sir Thomas (Hazel Grv)
Evans, Roger (Monmouth)


Atkinson, Peter (Hexham)
Evennett, David


Baker, Rt Hon K. (Mole Valley)
Faber, David


Baker, Nicholas (Dorset North)
Fabricant, Michael


Bates, Michael
Fairbairn, Sir Nicholas


Bayley, Hugh
Fenner, Dame Peggy


Beggs, Roy
Fishburn, John Dudley


Bellingham, Henry
Forsyth, Michael (Stirling)


Beresford, Sir Paul
Forsythe, Clifford (Antrim S)


Blackburn, Dr John G.
Forth, Eric


Bonsor, Sir Nicholas
Fox, Dr Liam (Woodspring)


Booth, Hartley
Freeman, Roger


Boswell, Tim
Gardiner, Sir George


Bowis, John
Gillan, Ms Cheryl


Brandreth, Gyles
Gorst, John


Brazier, Julian
Greenway, Harry (Ealing N)


Bright, Graham
Griffiths, Peter  (Portsmouth, N)


Browning, Mrs. Angela
Gunnell, John


Bruce, Malcolm (Gordon)
Hague, William


Burt, Alistair
Hargreaves, Andrew


Butcher, John
Harris, David


Butler, Peter
Haselhurst, Alan


Campbell, Menzies (Fife NE)
Hawkins, Nicholas


Carlisle, Kenneth (Lincoln)
Hawksley, Warren


Carrington, Matthew
Hayes, Jerry


Cash, William
Heald, Oliver


Chaplin, Mrs Judith
Heathcoat-Amory, David


Chapman, Sydney
Hendry, Charles


Clappison, James
Hill, James (Southampton Test)


Clark, Dr David (South Shields)
Hinchliffe, David


Clarke, Rt Hon Kenneth (Ruclif)
Horam, John


Clifton-Brown, Geoffrey
Hoyle, Doug


Colvin, Michael
Hughes Robert G. (Harrow W)


Congdon, David
Hunter, Andrew


Coombs, Simon (Swindon)
Jack, Michael


Cope, Rt Hon Sir John
Jenkin, Bernard


Couchman, James
Jessel, Toby


Cran, James
Jones, Gwilym (Cardiff N)


Currie, Mrs Edwina (S D'by'ire)
Kilfedder, Sir James


Davies, Quentin (Stamford)
Kirkhope, Timothy


Day, Stephen
Knapman, Roger


Douglas-Hamilton, Lord James
Knight, Mrs Angela (Erewash)


Dover, Den
Knight, Greg (Derby N)


Duncan, Alan
Knight, Dame Jill (Bir'm E'st'n)


Durant, Sir Anthony
Kynoch, George (Kincardine)






Lait, Mrs Jacqui
Shepherd, Colin (Hereford)


Legg, Barry
Skeet, Sir Trevor


Leigh, Edward
Spencer, Sir Derek


Lewis, Terry
Spicer, Michael (S Worcs)


Lidington, David
Sproat, Iain


Lightbown, David
Stanley, Rt Hon Sir John


Lyell, Rt Hon Sir Nicholas
Steel, Rt Hon Sir David


McCartney, Ian
Stephen, Michael


MacKay, Andrew
Stewart, Allan


Maclean, David
Streeter, Gary


McLoughlin, Patrick
Sweeney, Walter


Mahon, Alice
Sykes, John


Maitland, Lady Olga
Taylor, Ian (Esher)


Malone, Gerald
Taylor, Rt Hon D. (Strangford)


Mans, Keith
Thomason, Roy


Marek, Dr John
Thompson, Jack (Wansbeck)


Martin, Michael J. (Springburn)
Thurnham, Peter


Maxton, John
Townsend, Cyril D. (Bexl'yh'th)


Merchant, Piers
Tracey, Richard


Michie, Bill (Sheffield Heeley)
Trend, Michael


Monro, Sir Hector
Twinn, Dr Ian


Moss, Malcolm
Walker, Bill (N Tayside)


Neubert, Sir Michael
Wallace, James


Nicholls, Patrick
Waller, Gary


Norris, Steve
Wells, Bowen


Paice, James
Wheeler, Sir John


Patnick, Irvine
Whittingdale, John


Peacock, Mrs Elizabeth
Widdecombe, Ann


Porter, David (Waveney)
Wilkinson, John


Powell, William (Corby)
Willetts, David


Riddick, Graham
Wilson, Brian


Robertson, Raymond (Ab'd'n S)
Wood, Timothy


Robinson, Mark (Somerton)
Young, Sir George (Acton)


Ross, William (E Londonderry)



Sackville, Tom
Tellers for the Ayes:


Scott, Rt Hon Nicholas
Mr. Peter Luff and


Shaw, David (Dover)
Dr. Robert Spink.


Shaw, Sir Giles (Pudsey)





NOES


Ainger, Nicholas
Bennett, Andrew F.


Banks, Tony (Newham NW)
Bradley, Keith


Barnes, Harry
Brown, M. (Brigg & Cl'thorpes)





Callaghan, Jim
Meale, Alan


Clarke, Eric (Midlothian)
Miller, Andrew


Cryer, Bob
Morley, Elliot


Dafis, Cynog
Mullin, Chris


Dixon, Don
Parry, Robert


Donohoe, Brian
Patchett, Terry


Dowd, Jim
Pike, Peter L.


Eastham, Ken
Rogers, Allan


Enright, Derek
Skinner, Dennis


Gerrard, Neil
Smith, C. (Isl'ton S & F'sbury)


Godman, Dr Norman A.
Spearing, Nigel


Hardy, Peter
Stern, Michael


Illsley, Eric
Vaz, Keith


Jones, Robert B. (W H'f'rdshire)
Wareing, Robert N


Lestor, Joan (Eccles)
Wicks, Malcolm


Loyden, Eddie



McMaster, Gordon
Tellers for the Noes:


McWilliam, John
Mr. Jeremy Corbyn and


Marshall, Jim (Leicester, S)
Mr. Malcolm Chisholm.

Question accordingly agreed to.

Question put and agreed to.

Bill accordingly read a Second time and committed.

BANKRUPTCY (SCOTLAND) BILL [MONEY]

Queen's Recommendation having been signed—

Resolved,
That for the purposes of any Act resulting from the Bankruptcy (Scotland) Bill, it is expedient to authorise
1. the payment out of money provided by Parliament of—

(a) any fees paid by the Accountant in Bankruptcy under section 1B(4) of the Bankruptcy (Scotland) Act 1985;
(b) any administrative expenses incurred by the Secretary of State;
(c) any increase attributable to the Act in the sums payable out of money so provided under any other Act, and

2. the payment into the Consolidated Fund of any fees received by the Accountant in Bankruptcy in pursuance of regulations made under section 69A of the Bankruptcy (Scotland) Act 1985.—[Mr. Kirkhope.]

Orders of the Day — Armed Forces (Discipline)

The Minister of State for Defence Procurement (Mr. Jonathan Aitken): I beg to move,
That the draft Army, Air Force and Naval Discipline Acts (Continuation) Order 1992, which was laid before this House on 2nd June, be approved.
The purpose of the order is to continue in force for a further year the Army and Air Force Acts 1955 and the Naval Discipline Act 1957, which together provide the statutory basis for discipline in the three services.
The House will be aware that it is a long-established practice for service discipline to be fully reviewed every five years by means of the consideration of an Armed Forces Bill and for the disciplinary code as then enacted to be reviewed annually in the intervening years by an order in council which is itself approved by resolution of each House—[Interruption.]

Mr. Tony Banks: On a point of order, Mr. Deputy Speaker. This is an important debate, and we are hearing an important statement from the Minister. It would be helpful if hon. Members who do not intend to remain left the Chamber.

Mr. Deputy Speaker (Mr. Michael Morris): I am grateful to the hon. Gentleman. I ask hon. Members at the Bar of the House to retire quietly.

Mr. Aitken: The House will also be aware that an Armed Forces Bill was considered and duly enacted in 1991. That Act continued the three service discipline Acts until 31 August 1992 and endorsed the process of annual continuation thereafter by order in council. I am therefore asking the House tonight to give its annual renewal to the discipline Acts by approving the order.
After that brief introduction, it would on a routine occasion be appropriate for me to resume my seat and listen to the comments of hon. Members who wish to debate the order. However, this year this debate provides a useful parliamentary opportunity for the Government to respond to the principal recommendations of the Select Committee on the Armed Forces Bill, whose report was published last April.
First, let me thank the hon. Members who sat on that Select Committee for presenting to the House such a thoughtful report on various military disciplinary matters. After giving careful consideration to the Committee's recommendations I can tell the House that the Government intend to respond constructively and positively in the following specific ways.
The most controversial issue discussed in the report was that of homosexuality in the armed forces. After taking evidence from many quarters, the Select Committee upheld and accepted the Ministry of Defence's long-established policy that homosexual activity is incompatible with service in the armed forces. Indeed, in its report, the Committee acknowledged that the armed forces should not be required to accept homosexuals. However, the Committee did recommend that homosexual activity of a kind that is legal in civilian law should no longer constitute an offence under service law. That recommendation has been considered very carefully by the service personnel authorities, and they and Ministers have concluded that the Select Committee's recommendation should be accepted.
I think that the House will require a careful explanation of the effects of this decision. The Sexual Offences Act 1967 provides that homosexual acts undertaken in private between two consenting males over the age of 21 shall not be criminal offences. That Act, however, did not extend to members of the armed forces. It has therefore remained possible, though rare, for legal proceedings to be taken against service men and women for homosexual acts that are not criminal offences in civilian law.
It is now the Government's view, following the advice of the Select Committee, that such criminal proceedings should no longer be brought. My Department has therefore accepted that the special provisions of section 1(5) of the Sexual Offences Act 1967 should not apply in future. My right hon. and learned Friend the Home Secretary has been asked to implement the repeal of this part of the Act as soon as the legislative programme allows.
I should like to make it clear that this is a sensible measure of decriminalisation, whose purpose is to tidy up the differences between military and civilian law. It is not intended to alter the present disciplinary climate of service life.

Mr. Allan Rogers: I am grateful to the Under-Secretary for making this statement. We have been asking for some time for such a statement to be made. On the issue of decriminalising homosexual activity in the armed forces, are the people who are involved in such activities liable to be charged under other aspects of Army law?

Mr. Aitken: No, unless they have committed offences that might also be offences under service law, such as coercion. However, the conduct of consenting adults in private will not be an offence under the disciplinary code.

Mr. Rogers: If two consenting adult soldiers or members of the women's forces together participate in such an act, am I right in thinking that they will not be charged with conduct prejudicial to good order and military discipline, the usual catch-all phrase that is used? I remind the Minister that not for some time has anybody in the armed forces been charged with a criminal offence. A person has been charged either on administrative grounds or by use of the catch-all phrase, conduct prejudicial to good order and military discipline.

Mr. Aitken: The offence, which is technically a criminal offence under service law, is being decriminalised. I shall deal in a moment with discharges for administrative reasons. If a service man or service woman had committed an act that was a criminal offence in civilian life or that constituted a breach of service discipline—I mentioned the offence of coercion—that would be applicable to any sexual relationship, whether homosexual or heterosexual, a service prosecution would still be possible.

Mr. Menzies Campbell: Does not the point that the hon. Member for Rhondda (Mr. Rogers) made need further elucidation? I understand the Minister to be saying that a homosexual act between consenting adults in the forces will now be treated on the same basis as if it had occurred outside the forces. However, the hon. Gentleman asked whether that same act might be struck at by some other disciplinary provision under the criminal law, in so far as it applies to the armed forces.

Mr. Aitken: I was coming to the question of discharges. It remains the policy of the Ministry of Defence not to accept homosexual activity within the armed forces. Service personnel who are involved in homosexual activity will, as at present, be administratively discharged, whether or not any criminal offence has taken place.
I hope that the House recognises that, although we have moved in the direction of decriminalisation, as recommended by the Select Committee, we have not moved away from the standards of personal conduct required of all those who serve in the special circumstances of the armed forces.

Mr. Chris Smith: The step that the Minister has announced is a small but brave one in the right direction. However, I hope that he will accept that many of us want the Government to go further to ensure that ultimately the standards of conduct that we accept in civilian life are precisely those that are applied to military life.

Mr. Aitken: This would not be the House of Commons if that opinion were not expressed in it. Of course, I am aware of that view, but I can assure the hon. Gentleman that, in coming to these decisions, any Minister feels like the over-advised centurion in Macaulay's "Lays of Ancient Rome", when
those behind cried 'Forward! And those before cried `Back!'
There are different views on the issue.
I emphasise that homosexual activity remains incompatible with military service, and that those who engage in it must be expected to be discharged. However, in future, individuals who engage in homosexual activity that is legal in civilian law will not be prosecuted under service law and they will have no criminal record or entry on the police computer.

Mr. Rogers: I am grateful to the Minister, but we must have elucidation on that point. If he is saying that there is to be no change in the law, we must accept it. However, in a similar debate last year, the Minister of State for the Armed Forces said:
Our practice is that the majority of service personnel who are required to leave the services on grounds of their homosexuality are adminstratively discharged … Therefore, there is no question of such people having a criminal record on account of their homosexuality.
The Government are now saying that they are decriminalising homosexuality per se in the armed forces but that in practice there will be no change in their attitude. Earlier in the same debate, the Minister of State said:
It is a long-standing policy that both homosexual activity and orientation are incompatible with service in the armed forces."—[Official Report, 17 June 1991; Vol. 193, c. 115-16.] Are the Government sticking to that statement?

Mr. Aitken: Yes, the Government are sticking to that statement, but I think that the hon. Gentleman is being a little churlish in suggesting that there has been no change. It is true that the administrative practices in a great many cases will remain the same but, at the same time, the Select Committee found that there had been approximately 39 cases in the past four years of those who had been found to be indulging in homosexual activities who had been prosecuted. Those people at least will in future no longer have the problems of a criminal prosecution and criminal

record, so to say that there has been no change is not fair. An important principle has been changed and there has been change in some practical cases.

Mr. John Bowis: I welcome the step announced by my hon. Friend, because it is fair and will achieve a measure of justice in bringing together the civil and service laws. Nevertheless, does he understand that there is a need to go further and to consider the problems that some people will have if they lose their service job and wish to return to civilian life with a black mark on their record which would not be there had they conducted themselves in the same way in civilian life? In other words, someone whose activity in the services would be permissible in the Ministry of Defence could be disadvantaged at a later date, so that is perhaps the next step that my hon. Friend could investigate.

Mr. Aitken: We shall consider that point, but it is fair to say that in the overwhelming majority of cases there is no question of a black mark being obviously on the record. In evidence given to the Select Committee, one major general said that the type of report written in such cases was at pains not to disclose the fact that there had been any difficulties leading to the administrative discharge, although someone investigating further could come across such information if he dug deeply into the records.

Dr. Norman A. Godman: On the point raised by the hon. Member for Battersea (Mr. Bowis), will the Minister confirm that such a person discharged from the forces would not be dismissed with ignominy?

Mr. Aitken: I think that "with ignominy" is the wrong term because the usual literal term is "service no longer required", which could have many interpretations and ignominy would not necessarily be one of them.
It would be unfair to judge that that led to some obvious black mark or ignominious stain.

Mr. Tony Banks: May I ask the Minister a question which was asked earlier? Why do the Government consider that homosexuality is incompatible with service life?

Mr. Aitken: When one accepts service under the Crown in the armed forces, one also accepts that there are special responsibilities and special conditions. One set of those conditions is that one is not living totally in private but often in crowded barracks and under conditions of some stress. In those conditions, homosexual activities can cause difficulties to the community, and can have insidious effects on discipline, so they cannot be accepted as they can in civilian life.

Mrs. Edwina Currie: Like my hon. Friend the Member for Battersea (Mr. Bowis), I warmly welcome the announcement, but my hon. Friend the Minister has already recognised the difficulties caused by his failure to go one step further. The reasons which he has just given are precisely those which used to be deployed to justify keeping women out of the armed forces. Women are now in the armed forces, and most of them perform brilliantly. They add a great deal to the services and are good or bad soldiers according to their qualities, not according to their sexual orientation.

Mr. Julian Brazier: Does my hon. Friend accept that in the American armed forces, which have gone even further than we and have integrated women into combat units, elaborate and sometimes expensive measures are taken—for example, in the organisation and layout of barracks—to prevent the sort of problems that he has described arising between men and women, in terms of the pressures that can build up? If we were to make such arrangements to separate homosexuals, Opposition Members would be the first to make an outcry.

Mr. Aitken: I have had enough trouble getting through this subject in Britain, without having to examine what goes on in American barracks as well. My hon. Friend is right to say that there are some special strains and stresses of service life, whether in the American armed forces or in our own.
My hon. Friend the Member for Derbyshire, South (Mrs. Currie) has over-simplified the problem to some extent. But as she has intervened, I shall pay a genuine tribute not only to her but to several other hon. Members —my hon. Friends the Members for Mid-Kent (Mr. Rowe), for Battersea (Mr. Bowis), for Westminster, North (Sir J. Wheeler) and for Harlow (Mr. Hayes)—who have assiduously campaigned for changes in the law on this issue. They should take some satisfaction in the fact that a step forward has been taken in the direction that they would wish, although we may not have gone as far as all of them would have wanted.
Another important recommendation of the Select Committee concerned ethnic monitoring and racial harassment, referred to in paragraphs 34 and 35 of the report. The Committee made two recommendations about the position of members of ethnic minorities who join the armed forces. It said:
We recommend that the MOD consider how best to identify incidents of racial harassment in the armed forces and keep records accordingly, and we recommend that the MOD reconsider its opposition to ethnic monitoring of service personnel.
On the latter point, I am pleased to reiterate the announcement made by my right hon. Friend the Minister of State for the Armed Forces on 14 May that we shall extend to serving personnel our present practice of monitoring the ethnic origin of applicants to the three services.
On racial harassment, I remind the House that it is a clear and unequivocal policy within the armed forces that no form of racial discrimination is tolerated. Any complaint by a service man or woman of harassment or discrimination will be fully investigated under the redress of grievance procedures laid down in the service discipline Acts.
When considering record keeping, the Select Committee expressed concern about racial harassment as a form of bullying and recognised the difficulty in identifying cases in which race was the determining factor. There is no specific offence of bullying, racial harassment or racial abuse under the service discipline Acts. Such offences would be dealt with under other provisions, such as those involving conduct prejudicial to good order and discipline, or common assault.
Currently, only the Army records centrally all complaints of assault and other ill treatment. It also records separately complaints of racially motivated ill treatment. The Navy and RAF do not maintain central records of all complaints of bullying and other ill

treatment, but will do so with effect from 1 September and 1 August this year respectively. I need hardly say that bullying in itself is also regarded as a very serious matter and it has been made clear throughout the services that bullying and ill treatment will not be tolerated. I can report that the number of cases of bullying appears to have fallen significantly in recent years.
The Select Committe made a number of other specific recommendations which are being carefully considered within my Department.
The Committee expressed the view that there should be a presumption that under-18-year-olds should not be sent on active service overseas, unless there was an overriding requirement for their skills or the threat to national security was sufficient to warrant the conscription of minors. The services believe that their deployment of under-18s is broadly consistent with the Select Committee's view, but the matter remains under consideration.
The Committee also recommended that the Ministry of Defence examine the terms of enlistment for under-18year-olds and bring forward proposals for change within 12 months. I can assure the House that this recommendation is also being carefully and sympathetically considered.
The Select Committee also commented on the future of the Royal Navy detention centre and recommended that a timetable be announced for the closure of the RN detention quarters at Portmouth, and the redeployment of those facilities to the military corrective training centre —MCTC—at Colchester. A rigorous investment appraisal is being undertaken to determine the benefits and costs of such a step. The appraisal will be completed by the end of July. I ask the House to note that a decision in favour of transfer of facilities to the MCTC would necessitate further building work at Colchester, and that the time scale involved would mean continued use of the RN detention quarters into 1994–95.
The Committee also made recommendations regarding the services' sentencing policy to ensure equality of sentencing between men and women. This followed a visit to MCTC, where detention facilities for women are now available. I can assure the House that it has always been the intention of the armed forces to follow an equal sentencing policy, and the provision of specific detention facilities for women gives added practical effect to this policy. Action is in hand to amend the necessary regulations.
The Select Committee acknowledged the considerable changes which had taken place in the employment of service women since the previous Armed Forces Bill. It noted, however, that there were different minimum ages of enlistment for men and women—16 for men and 17 for women—and recommended that the minimum ages of enlistment for women should be brought into line without further delay.
I am pleased to tell the House that the Navy brought the minimum age of enlistment for women into line with that for men last October and that in September this year the Army will introduce a common enlistment age of 16½ for both men and women. The RAF is currently considering a common age of enlistment for both men and women. This change is in line with our policy of aligning men and women's terms and conditions of service where practicable.
Finally, the Select Committee recommended that


The Government provide parliamentary time in the next five years for legislation to consolidate service law".

Mr. Tam Dalyell: May I ask the Minister a question of which I have given him all too brief notice? When may we expect a statement by the Ministry of Defence on the declassification of records in respect of those who may have been taken prisoner in the Korean war? I have told the Department of my personal concern about certain of my contemporaries. Is the Minister prepared to contact the Commonwealth War Graves Commission to ask for information? In the light of the astonishing statement by President Yeltsin in Washington yesterday, what representations are being made to the Russian Government to obtain information about any such British service men who may still be alive?

Mr. Aitken: I am grateful to the hon. Gentleman for giving me notice of that question. I can give him some limited information. We did note President Yeltsin's remarkable statement; it has raised certain questions and possible lines of inquiry. We shall follow them up, and we will certainly take into account the hon. Gentleman's point about the Commonwealth War Graves Commission. About 100 service men were unaccounted for in Korea, and about 80 were missing in action but not thought to be prisoners of war. We are looking at all the cases where new information comes to light and we will follow up all leads and suggestions made to us by responsible sources.

Dr. Godman: Will the Minister confirm that the children of service families caught up in sexual or physical abuse cases will be given the same protection given to children in England and Wales in relation to the Criminal Justice Act 1987 and to children in Scotland in relation to the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990?

Mr. Aitken: I hope that the hon. Gentleman will recognise that I am only a Defence Minister. I am not qualified to comment on matters of Scottish law. However, I will endeavour to answer his question at the end of the debate if I am given the leave of the House to do so, or I will write to him later.
Before that intervention, I was referring to a legal matter about consolidation. I am pleased to tell the House that the Law Commission has already begun work on that task. It is a much-needed operation because, metaphorically speaking, the MOD seems to contain a veritable legal attic full of antiquated service law that needs tidying up or, in some cases, sweeping away. I was amused to discover that naval recruitment by the press gang is still legal under the royal prerogative and that at least 44 separate statutes need to be considered by the Law Commission, ranging from the Regimental Accounts Act 1908, the Seamen's and Soldiers' False Characters Act 1906 and the Colonial Naval Defence Act 1831.

Sir Nicholas Fairbairn: My hon. Friend may be aware that "arson" in the royal dockyards is still a capital offence.

Mr. Aitken: I am most grateful for that interesting information. However, I wonder whether my hon. and learned Friend's point has shown that there is a need for a House of Commons Discipline Act.
I hope that the House will feel that we have made a thorough and thoughtful response to the various recommendations of the Select Committee. There are

additional points that I have not been able to cover because of the time available, but my right hon. Friend the Minister for the Armed Forces, for whom I am deputising this evening, will write to my right hon. Friend the Leader of the House about them. If they are raised on the Floor of the House tonight, 1 will try to respond to them at the end of the debate.
I should like to conclude by reminding the House that, in their many different areas of operations, our services play an essential part in safeguarding our interests and freedoms. I pay tribute to their undoubted professionalism and dedication.
The high quality of our armed forces is due in no small part to their good morale and, in a military environment, to their fair and equitable system of discipline. It is essential to preserve that and to ensure that the high levels of efficiency and effectiveness that characterise the three services are maintained. That is what the Service discipline Acts seek to do, and I therefore invite the House to approve the order.

Mr. Allan Rogers: I congratulate the Minister on his appointment as Minister of State for Defence Procurement and I recognise that he is deputising tonight for the Minister of State for the Armed Forces who is in the Falkland Islands. Fortunately, I managed to get out of that so we are both meeting tonight away from our respective disciplines in defence matters. I am sure that the Minister will give his all to his duties.
I am pleased that the Minister has discovered that the press gang is still legal. I noticed a distinct gleam in the eye of the hon. Member for Canterbury (Mr. Brazier) when the Minister said that. I will refer later to the hon. Member for Canterbury because of his view in 1989 that we could solve the ethnic minority problem in the armed forces by having an all-black regiment. I do not suppose that that idea would receive much support from the Minister of State.
I want to pay tribute to our service men and women whose efficiency, skill and dedication are second to none and who continue to render great service to the country. Opposition Members have always supported our armed forces. We will not oppose the order because we recognise that a fair system of discipline is essential to the effectiveness and operation of our armed forces and that it is an essential framework in which they can exercise their skills and functions.
Breaches of discipline are relatively isolated, but, unfortunately, certain breaches of discipline occur regularly. Some of them form a pattern in many regiments, much to their shame. For instance, bullying was referred to by the Minister, not casually but in passing. Bullying in the armed forces takes place either formally often by way of brutal initiation ceremonies—which still exist, although, to their credit, the Government have tried to stamp them out—or informally, when individuals or groups take it on themselves systematically to terrorise their service comrades. Such incidents have occurred over the past year. My colleagues will refer to incidents in which some of their constituents have been involved.
Either type of bullying is absolutely indefensible. Besides being intrinsically wrong, it destroys morale and the well-being of units. Hon. Members who have served in


the armed forces realise how morale can be lowered as a result of groups of individuals bullying people who cannot look after themselves.
Successive Ministers have taken action. I pay tribute to the work of the hon. Member for Kettering (Mr. Freeman), who has been transferred to the Department of Transport. When the hon. Gentleman was Minister of State for the Armed Forces, he was most diligent in pursuing bullying, but still the problem exists. The problem will not be solved until the Government bring senior officers to book. It is no good bringing the perpetrators of bullying to book—it must be senior officers who command units. If they are not good enough to control sadistic behaviour in their regiments or units, they are not fit to command. Until the Government take strong action against senior officers, we shall always have endemic bullying in martial societies.

Sir Nicholas Fairbairn: Does the hon. Gentleman accept that one of the most endemic, sadistic and difficult methods of bullying in the armed forces is when one homosexual has a hold over another?

Mr. Rogers: I propose to deal with that intervention with almost the contempt that it deserves. It was a sweeping and silly statement. If the hon. and learned Member had talked in terms other than specifically about homosexuality, he might have had a point. I shall refer to the general issue of homosexuality. I urge the hon. and learned Gentleman to keep an open mind on the issue. It is complex. Homosexuality or heterosexual activity in the armed forces can, in certain circumstances, lead to breakdowns in discipline. That is equally true of an office, a factory, or the House of Commons, if we put the issue in a general working context, but I do not want to go any further down that line.
I was talking about bullying. Bullying takes on a special dimension when it occurs in the form of racial bigotry, discrimination and harassment. I welcome the Minister saying that he will set up the ethnic monitoring system to identify incidents and to keep records. I am not sure whether that goes far enough.
I believe that the Government deplore bigotry in our armed forces against coloured or black recruits. But they are not doing enough to combat it. It is all right to say, as Ministers have done in the past, that people should complain. The Minister of State for the Armed Forces said last year:
We hear of people who have left the armed forces and say that they were discriminated against during their time in the armed forces. It would be much more useful if they complained at the time. If they did, such allegations would be investigated by senior officers, and there is no doubt that any form of bullying or racial discrimination or harassment would be seriously investigated and dealt with."—[Official Report, 17 June 1991; Vol. 193, c. 117.]
How can one expect the victims of attack, racial prejudice, bigotry and harassment to feel that they have any redress in their units when the people to whom they are likely to complain are the very persons who are responsible for the general system under which they operate and, indeed, might even tolerate forms of discrimination? 
It is naive to say that, because a person does not complain at the time that he is bullied, beaten or discriminated against, he should not complain later. He operates in a system that induces an atmosphere of fear.

Complaints, even after the event, ought to be treated in a sympathetic manner. Simply to say what the Minister of State for the Armed Forces said last year seems a simple cop-out.
Much more needs to be done and much more must be done. Incidentally, as I said earlier, we do not want any further daft suggestions that the way to solve the problems of ethnic minorities in the armed forces is to set up ethnic minority regiments. I have never heard anything more daft in my life.

Mr. Greg Knight: What about the Welsh Regiment?

Mr. Rogers: The hon. Gentleman says, "What about the Welsh Regiment?" That just shows his English bigotry. But we shall leave it at that for now. I certainly shall not get involved in that one.

Sir Nicholas Fairbairn: What about the Welsh rugby team?

Mr. Rogers: We do not lose every rugby match. We might do a little better next year. As a Scotsman, the hon. and learned Gentleman should be careful on that point.
The balance of ethnic minorities in the armed forces is not improving. I hope that the new Secretary of State will address that problem. It is odd that ethnic minority groups form about 5 per cent. of the total general population but provide only about 1 per cent. of armed forces recruits. To my mind, that is a waste of an excellent source of first-class recruits.

Mr. Bill Walker: I suggest that the hon. Gentleman looks carefully at percentages when he suggests that certain people do not get their fair share. I do not know about the Welsh, but the Scots represent less than 9 per cent. of the United Kingdom population but provide far more than 9 per cent. of the strength of the armed forces. Therefore, it could be argued that the Scots enjoy more than double their fair share.

Dr. Norman A. Godman: Largely because of unemployment.

Mr. Rogers: My hon. Friend the Member for Greenock and Port Glasgow (Dr. Godman) says that that is largely because of unemployment. That may well be a measure. But what a silly statement the hon. Member for Tayside, North (Mr. Walker) makes. He does a disservice by talking about the Welsh and Scots as ethnic minorities. We regard ourselves as fully integrated members of the United Kingdom, not as ethnic minorities in any sense. Peculiar we might be, strange we might be, but we are full citizens of the United Kingdom and have been for many hundreds of years.
When I say that harassment and bigotry are shown to ethnic minorities I refer to those people who, simply because of the colour of their skin, receive a bad time in the armed forces.

Mr. Bill Walker: Ah.

Mr. Rogers: If the hon. Gentleman says, "Ah," in that naive way, he ignores a serious problem.
The apparently intractable problem of recruiting more people from ethnic minorities to the armed forces requires more effort. That is why I am pleased about the setting up of a register and that there will be ethnic monitoring of applications, and of people accepted for the forces,


because the percentage of applicants from ethnic minorities accepted is less than the percentage of white applicants.

Mr. Michael J. Martin (Glasgow, Springburn): Does my hon. Friend agree that the Brigade of Guards and the Household Regiments have a bad record when it conies to recruiting ethnic minorities? I do not think that there is a black officer in the Brigade of Guards.

Mr. Rogers: That is true. One only has to see the Brigade of Guards on parade up the road to see how it encourages members of ethnic minorities into its ranks. It is a shame and a blot on the British, when across the ocean in America a black man is the No. 1 soldier. We are still talking about pathetically low numbers in our armed forces.
An enormous amount of talent is out there to be used and I hope that the Minister and the Secretary of State will constructively consider our procedures for enrolling more people from ethnic minorities, as I have suggested.
I accept that the decriminalisation of homosexuality in the armed forces—an issue to which the Minister referred—is a step in the right direction. On the other hand, the Ministers' statement does not alter the fact that, if anyone engages in homosexual activity, they will be thrown out.

Mr. Bill Walker: Quite properly.

Mr. Rogers: That is a separate argument. I do not know whether that again demonstrates the bigotry of the hon. Member for Tayside, North.
In addition to issues that the Minister mentioned in general terms, being a lesbian or a gay is a ground for instant dismissal—ground for administrative discharge. One does not have to participate in a homosexual act or to dress or behave in a way which will give away one's sexual orientation. All that has to be established is that one is a homosexual.

Mrs. Currie: Is the hon. Gentleman aware that a person does not have to be engaged in any activity, but could be completely celibate, and that more than half of the soldiers discharged from the army under the rules are women?

Mr. Rogers: That is correct. One does not have to be caught having sex to be dismissed—merely being a lesbian or gay is enough. The special investigation branch immediately moves in, and routinely investigates allegations of homosexuality. Suspects are interrogated, asked to name names, their rooms are searched, their letters and diaries read and any leads followed up. As a result of those witch hunts, about 75 people a year— people who might well be celibate, non-practising homosexuals—are administratively discharged.
It is wrong for the Minister to suggest that that will alter—it will not, under the terms that he has outlined today. Those discharged lose their careers. They might be outstanding soldiers and members of the armed forces, but simply because they are lesbian or gay they have to find new employment and they lost out on pension rights. There are instances where people have lost as much as £0.25 million in such payments.

Mr. Michael Stephen: Does the hon. Gentleman accept that first, no one in this country is any longer under any obligation to join the armed forces unless they wish to do so? Secondly, the conditions under which

people have to live in the armed forces are totally different from those for the civilian occupations to which he referred.

Mr. Rogers: I do not know whether that is strictly true. When I did my national service, I slept in a barrack room with 32 people and no one inquired about anyone's sexual orientation.

Mr. Bill Walker: He must be joking.

Mr. Rogers: Given his public school background, perhaps the hon. Gentleman has more knowledge of such things than I do. I do not know why some people are so defensive about that. After all, their parents ripped them out of their homes at the age of three and packed them off to a private school. They were then locked in rooms with other little boys or girls. They spent 10 years in such peculiar, unnatural circumstances, but as soon as—

Madam Deputy Speaker (Dame Janet Fookes): Order. I remind the hon. Gentleman that he should address me. I do not expect to see his back.

Mr. Rogers: I apologise.
As soon as those little ones become big ones, they may join the Army, the Navy or the Air Force, but if they happen to be homosexual, they are discriminated against and thrown out of the forces.

Mr. Bill Walker: rose—

Mr. Rogers: I am not giving way to the hon. Gentleman any more; he has muttered enough.
When Conservative Members were at public school, do they remember any time when their classmates were thrown out simply because of their homosexual orientation? How many of their classmates were sent home to their mams and dads?

Mr. Bill Walker: rose—

Mr. Rogers: If the hon. Gentleman did not mutter so much, I might give way to him.

Mr. Phil Gallie: Will the hon. Gentleman give way?

Mr. Rogers: I shall do so in a moment.
Last year, the Minister of State for the Armed Forces made the Government's position on this issue clear when he said:
It is a long-standing policy that both homosexual activity and orientation are incompatible with service in the armed forces …The formation within these units of sexually motivated relationships are potentially very disruptive of discipline and morale, particularly when they cross rank boundaries.
If the Government were prepared to follow the logic of their argument and said that any sexual activity—heterosexual or homosexual—was immediate grounds for dismissal from the armed forces, one could understand it. Although the same argument could be adduced for both types of activity, the Government pick out homosexual activity. That is wrong.
The composition of courts martial is also important. The Government have considered that issue and last year the Minister of State for the Armed Forces argued that officers
know their men far better than their equivalents did 30 or 40 years ago. The conditions in which they operate, such as in Northern Ireland or on board ship, ensure that junior officers


especially are as in touch with their men as are senior non-commissioned officers."—[Official Report, 17 June 1991; Vol. 193, c. 115-16.]
I found that statement rather odd. I remind the Minister that 40 years ago personnel were serving on board ships in much more cramped conditions than those of today. Although conditions in the Army then were not equivalent to those which exist in Northern Ireland now, they were not dissimilar.
The Government have failed to provide evidence to support their claim that today's officers know their men better than their equivalents of 40 years ago. They should provide a much better explanation to support their argument that the expertise of officers precludes the use of NCOs on courts martial. The Minister's statement was illogical.
The Government have also continued to turn their back on the formation of organisations to represent service personnel. We are one of the few countries within NATO that does not allow service personnel organisations. The Government say that we do not need them and that people can make representations through their platoon officers or whichever chain of command they operate under. But the letter columns of the in-house Service publications, RAF News, Navy News, and the Soldier, continue to be filled with complaints. The regular attitude surveys carried out by the MOD may assist Ministers but they are of little assistance to Parliament.
On 17 June 1991, the Government said that they would consider providing more detailed guidelines on what is an unacceptable activity. Is the Minister now in a position to say what conclusion he has reached as a result of his considerations? We should remember that premature voluntary retirement costs the country huge sums of money. It can cost £3 million to train a fast jet pilot, but

if he leaves the service for any reason—or for the reasons in which some pilots are caught these days, which are clearly outlined in the Minister's questionnaires on officer premature voluntary release—he has cost the country huge sums of money which we can ill afford.

Mr. Keith Mans: The hon. Gentleman said that the Soldier and RAF News were filled with complaints. I am a regular reader of RAF News and was trying to work out the last time I saw a complaint in that magazine.

Mr. Rogers: We shall turf them out and send them to the hon. Gentleman. I assure him that complaints appear in those magazines. However, if he wants to see complaints, he need not check in Service magazines. Why does he not bother to go to the Library and get the questionnaire on officer premature voluntary release, in which members of the armed forces give details of why they are leaving the armed forces prematurely?
The point is that, even if one soldier, sailor or airman leaves prematurely because he has a problem, it means that the chain of command is not dealing with his problem and that the problem must be dealt with. Thousands leave prematurely every year, and the problem is not being resolved. In last year's debate, the Minister said that the figures were coming down but close analysis of the figures shows that the same amount of premature voluntary retirement is taking place.
The Minister mentioned that he was acting on a Select Committee recommendation. I join him in congratulating the Select Committee, and I welcome the Government's implementation of its recommendations. We want them to go a little further in some areas, but we respect the fact that discipline within the armed forces is vital for them to carry out their functions properly. They cannot do their tough job—whether on land, sea or in the air—
unless special circumstances pertain to them. But the Government could go much further.

Mr. John Wilkinson: First, I pay a warm tribute to my hon. Friend the Minister of State for Defence Procurement. It is a pleasure to have heard him at the Dispatch Box, and never more so than this evening, when he introduced the debate in a manner that was as lucid as it was stylish, as one expects from him. Moreover, his speech was sympathetic to the work of the Special Select Committee, and his approval of its procedure was heartening for those who served on it. It illuminated the debate.
Normally, a late-night debate on such an order is a relatively minor affair and quickly passed over. However, the Select Committee report highlighted a number of issues. I am pleased that my hon. Friend the Minister grasped the nettle of the difficult matters of homosexuality and of bullying—particularly of a racial nature—in the armed forces, and the need to maintain ethnic monitoring. I thought that he struck the right balance on those issues. I agree with the judgment of the Ministry of Defence.
The Ministry deferred judgment on a number of our recommendations. Its first deferral related to the treatment of minors being enlisted and discharged. They are important issues, and I hope that my hon. Friend will be able to reach a conclusion before long. Surely it cannot be right that a young soldier who joins at 16, becomes dissatisfied with military life, finds it different from his expectations and does not exercise his right to leave the service in the first six months, has to serve no less than five years with the colours, as the Army requires him to fulfil three years adult service after the age of 18.
An analogy, which my hon. Friend the Minister mentioned, is the difficult question whether we should require minors to serve on active duty overseas. The Select Committee was greatly exercised by this issue. We all recognised the tremendous enthusiasm of young people. Seamen could find themselves on operational duty overseas, afloat from the age of sixteen and a half, airmen could be on operational duty overseas from the age of 16 years and eight months, and soldiers could be on operational duty overseas from the age of 17.
I well understand—I am sure that it was the view of the Select Committee—that if our nation's ultimate security is at risk, age should not be a barrier to a willingness to defend our islands and their residents. But there is a genuine distinction to be drawn if our volunteer service men are sent on an overseas expedition simply by virtue of the fact that they have taken the Queen's shilling. The distinction which we sought to make was that, if the young people have a vital qualification without which their units could not perform effectively, they should go, but otherwise they should not. Furthermore, Army personnel under the age of 18 are not allowed to serve in Northern Ireland.
My hon. Friend the Minister also deferred judgment on our recommendation to combine the Royal Navy detention quarters with the military correction training centre at Colchester. Under "Options for Change". our armed forces are diminishing by the day, so such a rationalisation is overdue, even if the necessary building work will take a little time. I hope that the decision can be taken early, so that the amalgamation takes place as soon as possible.
A number of matters were not acted on. The first was the disciplinary status of our reserve forces. It was

interesting to note the policy implemented by the Ministry of Defence on the use of Reservists during the Gulf war. I am sure that the Ministry is still appraising the conclusions to be drawn from it. My hon. Friend the Minister referred to the Royal Auxiliary Air Force air movements squadron which performed so admirably in the conflict—as we all knew that it would. It was strange that Territorials were unable to serve in Germany, to make good the deficiency there caused by the departure of Regulars to the Gulf. I am sure that they would have been pleased to do so. However, several specialists made an outstanding contribution—not least my hon. and gallant Friends the Members for Wimbledon (Dr. Goodson-Wickes) and for Blaby (Mr. Robathan).
Because the Scud missiles were not as effective as expected and the Iraqi air force never achieved air superiority, the use of civilian airliners to carry freight and troops to the war zone never became a serious problem. However, the war zone could have posed a serious difficulty for civilian crews if they had sustained casualties. Unless, in such circumstances, civilian crews are required to be subject to the Air Force Act 1955, there could be a problem in a future conflict—and there might be also in the case of merchant seamen on board ships taken out from trade.
I know that the Ministry is examining these issues. A mini White Paper on Britain's reserve forces was published before the general election, but we have not heard the full outcome of the proposals that it contains.
Finally, there is a controversial point—the question of the standing civilian courts in Germany primarily, but also in other places overseas where British forces are stationed, which have jurisdiction over the dependent personnel of our service men.
They function in Germany as a legacy of the NATO status of forces Act. Civilians who commit offences there can be subject to German or British military legal jurisdiction. My belief is that civilian offenders should be wholly under German legal jurisdiction. This may be the case already—the necessary changes might have been implemented. If not, in view of German unification and the changed relationship between the host country and British forces stationed on German federal soil, I hope that our Government will re-examine the issue.
I commend my hon. Friend the Minister again for his enlightened attitude to our recommendations, and I am grateful for the decisions that he took.

Mr. Peter Hardy: The hon. Member for Ruislip-Northwood (Mr. Wilkinson) will forgive me if I do not follow him in the points that he made, though the House acknowledges that he made them with some authority.
The Minister clearly acknowledged that good morale is essential if the disciplinary code is to be rarely used—and that is devoutly to be hoped. The hon. Member for Harlow (Mr. Hayes) and I have the good fortune to be halfway through the new and splendid defence attachment scheme. Currently, we are closely and interestingly involved with the Royal Air Force. Any criticisms that I make are directed not at the RAF's leadership but at the political leadership. I shall not seek to embarrass the hon. Member for Harlow, who has accompanied me on my visits, but he may concur at least to some extent with my observations.


One is aware of the need for contraction and change. Perhaps it was a pity that the House paid overwhelming attention to the county regiments rather than to the other forces of the Crown. The Minister must understand that, if the high morale of the highest quality air force in the world is to be safeguarded, current anxieties require attention.
Only a few days ago, I spoke to a number of RAF personnel of senior aircraftsman and junior technician ranks who are developing considerable skills, and who would normally have a profound commitment to the service. They are marrying and starting families and they need to know whether they will become corporals or sergeants and receive a pay rise. They cannot see much prospect of the advancement that it is natural they wish to see. If the morale of those who will fill the senior NCO ranks in a few years' time is allowed to diminish further, there may be cause for profound anxiety. I hope that the Minister will ensure that that concern is given more attention.
An even more serious matter—one that requires urgent and balanced political consideration—is contractorisation. It seems that in this context the RAF faces serious long-term danger. If the various mechanical and technical services are contractorised at the present pace, disadvantages will ensue. We shall be capable of mounting an adequate defence of the realm only between the hours of 9 am and 5 pm. As jobs are transferred to civilians, RAF stations will become half empty, at least after 5 pm.
The Government seem to believe that it is cheaper to employ a skilled tradesman who is a civilian than a skilled service man. If we continue to give jobs to civilians, the skilled tradesman in the RAF will be so frequently taken from his job to undertake guard duty and other such jobs that he will become even more expensive, which will lead to further contractorisation and civilianisation.

Madam Deputy Speaker: Order. Before the hon. Member continues, perhaps he will explain how his remarks relate to discipline.

Mr. Hardy: I shall do that, Madam Deputy Speaker.
If service men see their ranks diminish and the numbers of their colleagues in their camps contract, RAF stations will be weaker in terms of their leisure activity and quality of life. Morale will be adversely affected and disciplinary problems are bound to increase. I think that that will be recognised by hon. Members who have examined these matters.
Frustration may stem from disciplinary inadequacies. The hon. Member for Harlow and I recently visited RAF Sealand, where in several instances Government policy appeared to be exceedingly dangerous and likely to lead to disaffection, at least to some extent. We were told of the positive push for more privatisation. We met a small group of men and we were given some interesting information about their professional activities.
It appears that, shortly before the Tornados went to the Gulf, it was discovered that they needed a gadget called a capacitator. The RAF went to private contractors, who said, "Yes, we can make the capacitators. It will cost you several thousand pounds each and it will take 16 to 18 weeks before we can deliver them." A small group of men

at RAF Sealand gave up their weekends and produced capacitators for —105 each. As a result, the Tornados were able to go to the Gulf.
I opened a book—this is relevant to the question of morale—about the Gulf war which had been published in the United States of America. Its reference to the contribution of the RAF was to state that 12 Tornados had been shot down, which was not true. In my view, leadership within the service is of high quality, but leadership at political level allows that sort of statement to go unchallenged.

Mr. Jerry Hayes: I do not want the hon. Gentleman and me to seem too much like a double act, but we are doing an attachment together, and he has talked a great deal of common sense. Although I am not attacking Government policy in any way, I think—and I am sure that the hon. Gentleman will agree—that the Minister should consider carefully what is being achieved at Sealand.
Time after time, millions of pounds of taxpayers' money were saved by the ingenuity and hard work of people there. It will cost —600 or —700 for contractors to provide a little cable; at Sealand, it can be done for —50. Does the hon. Gentleman agree that what is happening there is a model of what should be happening throughout the armed services, not just in the RAF?

Mr. Hardy: I do agree. Because other hon. Members wish to speak, I shall not labour the point, but I hope that I shall catch the eye of the Chair towards the end of our attachment or soon after it.
Many Opposition Members were never ardent cold war warriors, even if we accepted the need for national defence. however, it seems obvious to me, as an internationalist, that as the world moves towards having sane international authority and the capacity to make a contribution to securing peace and stability, Britain will have a role to play, because our armed forces are of very high quality, Surely, in terms of quality, the RAF is unmatched in the world, and it will have to maintain the capacity to make that contribution, as it did in the Gulf.
When we watch the Red Arrows fly, with their remarkable skill and precision—bearing in mind that that outfit employs only 71 people—and when we see the contribution made on, say, Battle of Britain day, in an entirely voluntary capacity, at the splendid RAF station in South Yorkshire, Finningley, we must accept that, despite the efforts made at the stations by RAF personnel of all ranks, they need rather more political championing than they have received over the past two years.
Sadly, over the past 12 months, a myth has arisen that is very hard on the tradition— for tradition it is, although it involves the youngest service men. That myth holds that the Gulf contribution was of no account and, indeed, unsuccessful. I consider that it was remarkably successful in ensuring that a very large Iraqi air force was grounded. Over the past few weeks, not a single Front Bencher did not allow ridiculous twaddle to be talked about Bomber Command, and thus about the heart of the history and tradition of the RAF. That is relevant to discipline, because tradition and history are.
No one has paid any attention. No one responsible for the political leadership of the Air Force—I am not talking about serving ranks—told the British public that the contribution of Bomber Command, and the sacrifice of the


lives of thousands of air crew members, ensured that the German industry produced fighters rather than bombers. We must ask which towns would have been blitzed if those men had not flown in German night skies. If they had not, thousands of German guns and German soldiers would probably have achieved success on the Russian front and brought a very different accounting when the Normandy invasion took place.
The RAF is aware of that, and it is a pity that no one in government made it plain—just as it is a pity that the Government have been so obsessed by some of their articles of dogma in the past two years. In the various RAF stations that we have visited, we have been met with the utmost courtesy and co-operation, for which I am extremely grateful—as, I know, is the hon. Member for Harlow. We would, however, be acting irresponsibly if we did not reflect some of the anxieties that we have encountered, to which I trust the Government will attend a little more carefully.

Mrs. Edwina Currie: I thank my right hon. and learned Friend the Secretary of State and his right hon. and hon. Friends for the first positive step that has been taken for a number of years to ease the burden carried by homosexual and lesbian people It is entirely appropriate that it should have been made by a Conservative Government, led by a Prime Minister who wants the nation to be at ea se with itself; a nation in which every citizen is encouraged to make his or her best contribution.
It is worth remembering that 78 gay or lesbian military personnel were dismissed from the forces in 1990 after admitting to homosexuality. Six were court-martialled and three were imprisoned for 18 months for offences that were not crimes under civilian law. In the case of lesbians, they have never been crimes under civilian law. Between 1987 and 1989, more than 300 were discharged and 32 imprisoned. As has already been said, we cannot afford to lose good soldiers at that rate.

Mr. Wilkinson: Good soldiers?

Mrs. Currie: Yes, good soldiers. These people were volunteers. After having been recruited and trained, over 300 were discharged. Over half the people discharged from the Army were women. The Minister should be proud that at a stroke he removed that legal discrimination. I hope that he will ask for any existing prosecutions to be stopped and the slate wiped clean for the individuals concerned.
Before the Minister becomes too complacent—as the response to his announcement showed he still has a little further to travel—it is a complex and sophisticated journey. On the basis of what he said, a homosexual soldier—I use "soldier" to cover all the forces, and both males and females—even if entirely celibate and not practising, could still be dismissed from the services.
That raises two different questions: first, how do we treat homosexuals in our society at large? The civilian police, just like the military police, should have something better to do with their time than hound people. That is not on any longer. That is why it will not do to continue the general armed forces ban on homosexuality. It leaves good soldiers, good personnel, open to blackmail and undue pressure. It is way out of line with what happens in the armed forces of a number of our NATO allies.
That leads, secondly, to the whole question of pastoral care in the armed forces. The issues are very complex. I have read the Select Committee report on the Armed Forces Bill. It is about time that a woman was on the Select Committee. That does not mean that I am volunteering, but the fact that all the members are male flavours some of its reports. However, the Ministry of Defence is getting much better at discipline and is to be congratulated. It has dealt much better with bullying. It is dealing with alcoholism far better than it used to do. The Ministry has picked up the issues that face women soldiers—for example, maternity leave, instead of just dismissing them out of hand when they get pregnant, even though it took a court case to push it into doing that.
Now we have to face the question of what happens when two soldiers have sexual relationships, whether they are on duty or off duty, and what to do about the mess and the misery that can occur when a soldier has an affair with somebody outside the services. This is a matter that affects people with other sexual orientations. Recently there have been two dreadful cases involving the murder of people associated with or in the armed forces. They show how far tragic passions can take them. Now that women are serving with distinction in combat positions in all the armed forces, the issue is being addressed. It is being tackled in the Navy, at least. Reference is made to that in the Select Committee report. We need to take that a little further.
We often deal with very young people. I put on record that I wonder whether sixteen and a half is too young to be recruiting soldiers. The advice that I give to my sixteen-and-a-half-year-old constituents, male and female, is that they ought to be at school.

Mr. Wilkinson: My hon. Friend's point is exactly the one that the Select Committee thought about most seriously: would the parents of young people—16 and 17-year-olds who are, in some cases, children—wish them to be under the influence of overtly homosexual people? I do not think they would. They would wish the environment to be as nomal as possible, compatible with the rigours of military life and discipline.

Mrs. Currie: I say to my hon. Friend, whose view I treat with the greatest possible respect, that I have a 17-year-old daughter and I think that she should still be at school. I should worry as much if she went into the armed forces, not because of some bloke or woman who might attack her but because she would be putting her life at risk—that is the point about joining the armed forces.

Mr. Hayes: rose—

Mrs. Currie: I hope that my hon. Friend will forgive me for not giving way, but time is very short.
We are talking about young people who are often far from home and often for the first time. They are often in dangerous or isolated circumstances and stress is a big problem. These were the issues raised with us by the Gulf families campaign about soldiers of all ages and backgrounds and the difficult circumstances in which they can find themselves.
There are several issues that we must put to the Ministry of Defence. How are we to ensure the maintenance of good discipline in all environments, irrespective of gender or sexual orientation? How are we to ensure that those responsible for discipline are sensitive


and supportive and do not merely put the boot in and the cuffs on at the first hint of trouble? I think that it will mean a lot of retraining for those in charge of personnel matters because the evidence given to the Select Committee by some senior officers do not fill me with confidence. Some talked as if this were still the 19th century.
With those words I congratulate my right hon. and hon. Friends and support the order.

Mr. Andrew Mackinlay: I begin on a note of unanimity by agreeing that there is inadequate time for the House to discuss this important order. I hope that those who fix things in the House will take that on board.
The continuation order gives further life to section 1 of the Armed Forces Act 1991 but one must go back a stage further to realise that we are in effect renewing the Army Act 1955 which, I submit, is an old Act requiring a great deal of revision. I listened to the Minister talking about the attic of regulations and disciplinary procedures which need to be examined. To that I say, "Hear, hear," because the 1955 Act deals with a number of capital offences which are inappropriate and archaic, in addition to other matters to which the Minister referred.
I hope that this will be the last year that we shall deal with disciplinary matters by order. Perhaps in future there will be primary legislation to deal with discipline in the armed forces, which will give us appropriate, modern disciplinary codes for all service men.
I shall not vote against the order tonight if there is a Division. However, I hope that if the Minister takes on board the need for new legislation, it will incorporate some of the points raised tonight, especially the liberalisation of matters affecting people's sexual orientation. I hope that new legislation will mean that it is no longer a matter for disciplinary action.
Another issue that I hope will be included in any future legislation relates to the 307 service men executed in the 1914–18 war on charges including cowardice, desertion, disobedience, sleeping at posts, quitting posts and hitting a superior officer. Future legislation should include a schedule to exonerate them and/or give them a pardon. That could be the vehicle for excusing brave British soldiers from unfair ignominy.
Hon. Members may wonder why I raise this issue tonight. This morning I received a letter from a gentleman who wrote:
I myself was a soldier during that war and I fought in Belgium and France from 1917 until the war ended. During that time I actually saw posted an official notice reporting the execution of a soldier in my own unit and I remember vividly the feeling of horror I had and my fear that such a fate would befall me. I was only 18 at this time and now at the age of 94 I applaud your efforts to get this matter reviewed.
I hope that the Minister will bear that in mind, and that, if nothing else, the Secretary of State will agree to receive a small delegation in the not-too-distant future, so that we can amplify our concern and demonstrate why there has been a miscarriage of justice and why—even at this late stage—it is appropriate to review the subject. That could be done fairly, to the advantage of those British soldiers who lie with their comrades in Flanders, and all along the western front as well as in Gallipoli.
I hope that the Minister will be prepared to reconsider. I realise that the hour is late and that there are only a few

minutes of the debate left, so I shall not labour the point further. This is a matter associated with discipline, and thousands of people in this country still feel strongly about it. It is time that we recognised the people who were shot at dawn as victims of the great war, and as brave British soldiers.

Mr. Aitken: The debate must end in five minutes' time. With the leave of the House, I shall reply briefly to some of the points raised by hon. Members on both sides of the House. I am sorry that, for reasons of time, I shall not have the opportunity to reply to all the points, but I shall do my best to cover what I consider to be the principal questions which need a response. I am sorry that my response will be so brief and that so many hon. Members who wished to speak have not been able to make their contributions.
Perhaps because of his good nature, the hon. Member for Rhondda (Mr. Rogers), who opened the debate for the Opposition, found it difficult to criticise much of what the Government were doing. I am grateful for that. He was straining a little far when he banged on about bullying and made it sound as if it were an enormous problem. Even one case of bullying is too many; the services take an immensely serious view of it, and it has been made clear throughout the armed forces that it will not be tolerated. A range of measures to combat bullying have been introduced in the past few years, including the banning of initiation ceremonies.
We should see the matter in perspective, however bad any individual case may be. We have about 300,000 service men, yet in 1989 only 25 allegations of bullying were substantiated by courts martial; in 1990 there were 1I cases, in 1991 six cases and in 1992 two cases. That is hardly endemic bullying—as the hon. Gentleman described it.

Ms. Joan Walley: Does the Minister agree that, despite what he said, on the basis of the experience of a constituent of mine there is still an urgent need to review the subject of bullying? The Select Committee report represents some advance, but it does not go far enough. There should be a specific offence of bullying, and we should do more in addition to the measures introduced in 1988 to start to wipe out institutionalised bullying in the armed forces.

Mr. Aitken: I cannot accept the phrase "institutionalised bullying", because it implies that the institution itself approves—which it definitely and categorically does not. But I hear what the hon. Lady has said and I am sympathetic to her argument that any bullying is unacceptable, appalling, disgraceful and not to be tolerated. I take it from what she said that she had a serious case involving a constituent. If so, if she writes to me or comes to see me—or rather, my right hon. Friend the Minister of State for the Armed Forces—the matter will be taken immensely seriously and thoroughly and carefully investigated.

Ms. Walley: rose—

Mr. Aitken: I do not think that I should give way to the hon. Lady twice, as other important speakers contributed to the debate.
I pay tribute to my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson), the Chairman of the


Select Committee, who, with his Committee, has done a superb job of work. I was grateful for his generous comments about me, and I thank him above all for showing that the Select Committee system can work well. It takes two hands to clap, and both the Government and the Select Committee have responded in equal part in introducing many reforms which started with the Committee—to its credit.
My hon. Friend the Member for Ruislip-Northwood and my hon. Friend the Member for Derbyshire, South (Mrs. Currie) referred at some length to the treatment of minors. That is a difficult subject and, as I said earlier, the Government are considering it carefully.
The services do not wish to take on personnel who cannot adapt to service life. We make every effort to ensure that such recruitment does not take place. Any minor has the opportunity after the first 28 days of service and before six months' service has elapsed to leave easily. Thereafter, any request to leave the services—usual contracts are for three or four years-on compassionate or other grounds will be carefully and sympathetically considered on merit.
As Major General Stone said in evidence to the Committee, it costs the taxpayer £23,000 to train a junior infantryman. Such resources should not be easily thrown away if there is a brief moment of personal unhappiness in a young person's career. We are carefully considering the matters raised in that connection this evening—

It being one and a half hours after the commencement of proceedings on the motion, MADAM DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 14 (Exempted business).

Question agreed to.

Resolved,
That the draft Army, Air Force and Naval Discipline Acts (Continuation) Order 1992, which was laid before this House on 2nd June, be approved.

Mr. Dalyell: On a point of order, Madam Deputy Speaker. Many hon. Members—Conservative, Labour and the Liberal Democrat spokesman—have been disappointed not to be able to speak on the important matters raised in the defence debate. Could the Clerks investigate when the rules were changed? You will recall that the late George Wigg was able, under exempted business, to go on at great length on precisely such orders as this one.
By what alchemy did this become time-limited business and cease to be exempted business? Many of us wanted to raise all sorts of important personal issues. My hon. Friend the Member for Stoke-on-Trent, North (Ms. Walley) wanted to say a great deal more, as did my hon. Friend the Member for Thurrock (Mr. Mackinlay). The Liberal Democrat spokesman was not called either. Doubtless a battery of Conservative Members wanted to make constituency points too. How did this come about?

Madam Deputy Speaker (Dame Janet Fookes): I sympathise with hon. Members who have not been able to speak, but I can only operate the rules as they stand. I am sure that a little perusal with the Clerks or in the Library might throw light on the history of the matter.

Ms. Walley: Further to that point of order, Madam Deputy Speaker. I echo what my hon. Friend said. I wanted to speak not so much about an individual case of bullying as about the implications that arise—

Madam Deputy Speaker: Order. The hon. Lady cannot continue the debate under the guise of a point of order.

Ms. Walley: If I may—

Madam Deputy Speaker: Order. You may not.

Orders of the Day — Rail Service (London-Cleethorpes)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Robert G. Hughes.]

Mr. Michael Brown: I am most grateful to those who determine whether we secure Adjournment debates that I should have the good fortune to be able to raise the subject of the direct rail services between London and Cleethorpes. I am delighted to see attending the debate the Minister for Public Transport, who is to reply, my hon. Friends the Members for Lincoln (Mr. Carlisle) and for Gainsborough and Horncastle (Mr. Leigh), and the hon. Member for Great Grimsby (Mr. Mitchell). They too have an interest in the debate following the recent proposal by British Rail to withdraw the high-speed 125 train service that operates once a day in the morning from Cleethorpes to King's Cross and calls at the stations of Cleethorpes, Barnetby, and Habrough in my constituency, and then at Great Grimsby, Market Rasen and Lincoln before joining the main line at Newark. So the train services my constituents and those of the other hon. Members whom I have listed.
I know that my remarks will be heard by British Rail because of the forceful support offered by the constituents of my hon. Friends.
This train is the premier service to London from north Lincolnshire and south Humberside. It was introduced 10 years ago in 1982. Until then, we had four direct trains in each direction with full first and second-class carriages. They were diesel-haul locos with buffet and dining car services. Those four trains were withdrawn in 1982 and BR said that they were to be replaced by a single, but premier, train which would arrive in London about 9 am, and that there would be a return train in the evening. That train has been well used and well supported for 10 years by local people in all our constituencies.
Four years ago, when BR proposed to introduce the new 225 trains—the trains with electric overhead wires —my hon. Friend the Member for Gainsborough and Horncastle and I wondered what might happen if all high-speed main line train services were only 225 trains. We recognised that there was no electrification between Newark and Cleethorpes. In 1988, we took the trouble to press BR very firmly about the future of high-speed train services between south Humberside and north Lincolnshire and London.
My hon. Friend the Member for Gainsborough and Horncastle and I wrote to BR stating that we noted the tremendous investment that the Government were making available to BR for the 225 electrified trains. We said that it might be possible that one day the diesel electric-powered 125 trains, like those on the Cleethorpes to London service, might wear out. We wanted to know what would happen then.
We were accused of raising fears where there were none. However, we were very specific in what we said to BR. Back in 1988, I wrote asking specifically about the future of that train after 31 December 1991—just 150 days ago. I received a letter from Mr. Prideaux, who was then the managing director of InterCity. He wrote in 1988:
Thank you for your letter of 21 April. I would confirm the assurances given in the letters of my InterCity marketing manager at York that we plan to continue the operation of a through service between Cleethorpes and King's Cross for the foreseeable future. We have not reached the stage of planning

timetables beyond 1991, but it may help if I say that we have already decided to retain a number of refurbished high-speed train sets to operate services beyond the electrified area including that to Cleethorpes after that date.
My hon. Friend the Member for Gainsborough and Horncastle was taken to task by Mr. Holland, the InterCity marketing manager, when he wrote to BR in similar terms to mine. Mr. Holland assured him:
May I support the assurances about the future of the train which you have already received from Chris Austin British Rail's parliamentary affairs manager. The train performs reasonably satisfactorily in the financial sense and serves an area with potential for future growth. There is no (nor has there been) any intention of withdrawing it. We cannot of course unconditionally guarantee its continued existence for ever any more than any commercial business can indefinitely underwrite any product since its survival will obviously depend on its usage and earnings remaining satisfactory. But I am puzzled as to why you should believe that this train is to be withdrawn. Can you elucidate upon the cause of your fears?
My hon. Friend was taken to task in no uncertain terms by BR. Those assurances today are not worth the paper on which they are written.
I took the trouble to write to BR when the announcement was made 10 days ago, and I received responses from the parliamentary affairs manager and Mr. Brian Birdsall, the director of the east coast main line. He refuted my allegation that BR had misled my hon. Friends, the hon. Member for Great Grimsby and me. It denies that anything that it said in 1988 was at variance with the position in 1992. Never again will I treat anything that I see on paper from British Rail as anything other than worthless.

Mr. Austin Mitchell: I congratulate the hon. Gentleman on securing this debate. It shows great initiative and the determination of hon. Members to oppose the proposal. He is telling a story of deceit and incompetence. As a supporter of British Rail and public transport—indeed, I am a frequent user of it—I find it very hard to love British Rail or even to support or condone its behaviour. It made promises that it obviously had no intention of keeping and which it is now betraying, and it is badly letting down our area. Like the hon. Gentleman, I want it to know that we shall oppose its proposal tooth and nail with every weapon at our disposal.
Is not the most appalling aspect of the sorry saga the fact that British Rail is not only judge and jury in its own case but able to manipulate the evidence as well? It says that usage has not been adequate, but it is the controller of that usage. It looks as though it has set out deliberately to run down usage of that valuable service to our area by bringing the times forward to 6 am, a very inconvenient time, and changing them later in the evening so that people find it more difficult to spend a day in London and get back quickly. It has reduced services on the train, particularly breakfast and restaurant car services. Most appalling of all, it has cut out cheap fares on the service with the deliberate intention of keeping places empty, to fill up at Newark and beyond. In other words, it is depriving the people of Grimsby and Cleethorpes of the service by increasing the fares so that it can fill the train later on.
Does not that show that British Rail is prepared to fiddle the evidence so that it can use the remaining 125 trains for other purposes elsewhere which are more


convenient to it but not to the area? Does not that show also that it will do the same thing again? If it takes off the service, it will then use the form in usage—

Madam Deputy Speaker (Dame Janet Fookes): Order. That is a speech, not an intervention.

Mr. Mitchell: I am most grateful, Madam Deputy Speaker, I—

Madam Deputy Speaker: I am sorry, but that is enough.

Mr. Brown: I could not disagree with anything that the hon. Member for Great Grimsby has said. He is absolutely right about deliberately running down the service. British Rail has attacked me for making that allegation. Indeed, I have gone even further than the hon. Gentleman. I have accused British Rail of sabotaging the service, but that is what is happening.
Until last year, it was possible for passengers from Cleethorpes, Grimsby, Market Rasen and Lincoln to use the cheapest fare of the day on that train. Last year, British Rail withdrew that cheapest fare. If a housewife wishes to go to London as a casual passenger—perhaps she wants to do a day's shopping in London—she is encouraged not to use that train, because the cheapest fare of the day is now not available until after 9.30.
As the hon. Member for Great Grimsby has said, British Rail is judge and jury, yet it wants to have it both ways. Normally, one restricts the use of cheap tickets on a train in the morning and evening rush hours because it is a full train and one wants to use a pricing policy to ensure that those who travel on the train regularly, such as season ticket holders or business men, can get seats. Until last year, the casual traveller was encouraged, with all sorts of promotions and advertising deals, to take advantage of that train. Now they are denied the opportunity. Then British Rail has the cheek to advise the four hon. Members who represent north Lincolnshire and south Humberside that the reason that it will suspend the service with effect from next year is because not enough people use the train between Newark and Cleethorpes. That is a ridiculous argument.
British Rail is proposing that we should have small regional connecting services between Newark and Cleethorpes. That will simply encourage more people to drive their motor cars to either Newark or to Doncaster. In two or three years, British Rail will say, "Oh well, none of you is using the line between Cleethorpes and Newark, so we are certainly going to close it between Barnetby and Lincoln," leaving my hon. Friend the Member for Gainsborough and Horncastle without any railway service whatsoever in Market Rasen.
We are already seeing the beginnings of that plan of attack. British Rail is making it more financially worthwhile for a passenger to travel to London via Doncaster from Grimsby and Cleethorpes and Barnetby. The ticket via Doncaster to London costs £31. The cheapest ticket via Newark costs £38. British Rail will encourage more and more people to travel via Doncaster to London to enable it to reserve its position on the total closure of the line in three or four years.
I have dealt with British Rail for many years. I have seen its promises on pieces of paper. I have quoted those promises today, four years later, in the House. I can see exactly what will happen. Does my hon. Friend the Minister agree that there is at the least a case for local

Members of Parliament saying to British Rail that, as the Government intend to privatise it during the next 18 months to two years, it should defer its decision? In the event that a private operator wants to take over the service, it should still be in operation on vesting day when ownership and control of British Rail or its track authority passes to the private sector. It would be an act of sabotage if British Rail ran down services and the direct train, in particular before the private sector had an opportunity to operate in the new environment that the Government intend to create in later years.
British Rail wrongly and unfairly seeks to put the blame on the Government. In its letter of 15 June, it says that anything that it said to me in 1988 is made redundant by the new targets on assets employed which the Government require it to meet. I do not accept that. I should be grateful if my hon. Friend the Minister would elucidate on whether that is just another of British Rail's lame excuses.
I believe that, properly marketed, the train could continue to be as viable as it has been in the past. It is our only link with London. We used to have an air service from Humberside airport. We used to have competition. That competition spurred both Air UK and British Rail to provide a good service. For a time, we had true competition. There is no longer a direct air service between south Humberside and north Lincolnshire and London. Now there is not to be a direct railway service.
At the least British Rail should defer its decision until ownership has passed from the state to the private sector. I understand that it will be possible for private companies to operate over British Rail tracks when new legislation is in place in about 18 months. I should be grateful if my hon. Friend the Minister can confirm that that is the case.
In the meantime, I hope that the attendance of my hon. Friends the Members for Lincoln and for Gainsborough and Horncastle and the hon. Member for Great Grimsby will be noted by British Rail. I agree with every word that the hon. Member for Great Grimsby said. I hope that British Rail will take the fact that the debate has been attended by all the Members of Parliament for north Lincolnshire and south Humberside as a signal that we are all angry on behalf of our constituents. We shall not let the train go without one hell of a fight. I hope that my hon. Friend the Minister of State can give us some words of encouragement.

The Minister for Public Transport (Mr. Roger Freeman): This is an important debate. I pay tribute to my hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown) for the vigour and clarity with which he argued his case. I understand that he made the same speech in a debate earlier this evening. That is a great credit to his ingenuity as a parliamentarian but also clearly underlines the importance of the subject.
The presence on the Front Bench of two fellow Ministers who represent contiguous constituences, straining at the leash to contribute to the debate but having to remain mute, is a great stimulus to provide what I hope will be a constructive response. I find it interesting, but not entirely surprising, that the hon. Member for Great Grimsby (Mr. Mitchell) has joined in the debate and that there has been apparent agreement between Members on both sides of the House on the issue.


British Rail has not proposed to close the line. We are concentrating on the absence of a through service from Cleethorpes, via Great Grimsby and Newark to London. The existence of a through service is often a crucial factor when business men and women decide how to travel to London. I accept, as I am sure that British Rail accepts, that a connecting service—albeit a frequent class 158 service—on the line from Cleethorpes to Newark will not be acceptable to some passengers. They might prefer to drive direct to Newark, with consequences for the road system, or to drive straight to London. That is not an acceptable or a sensible consequence environmentally or in terms of the best usage of our rail system, and it is important to look for solutions.
British Rail has tried to encourage patronage of the line. As far as I am aware, the line is almost unique. I can find only one other example where saver tickets are issued on an InterCity line. My hon. Friend the Member for Brigg and Cleethorpes criticised British Rail for not offering super-saver tickers, which were withdrawn, but at least saver tickets are still in existence and that is almost unique. The truth is that fewer than 100 passengers use the through service on the line beyond Newark—there is one through service in either direction each day.
I am sure that my hon. Friend understands that I have no power to intervene in British Rail's decision. There is no way in which the Government can direct British Rail to continue a through service after May 1993. One can argue the case—as I am sure that my hon. Friends and the hon. Member for Great Grimsby will do with vigour—but the Government cannot issue a direction.
My hon. Friend the Member for Brigg and Cleethorpes asked two key questions. First, he asked me to comment on InterCity's objectives and, secondly, to look to the future. What are the possible solutions for the service, if British Rail perseveres with its intention to withdraw it?
First, on the InterCity objectives, InterCity provides not a social but a commercial service. I am grateful for my hon. Friend's implicit acceptance of that policy. I know that he supports the notion that InterCity should seek to operate commercially and to cover its costs. There is no division between the two sides of the House on that issue. The Labour party and the Government are at one in expecting InterCity at least to recover its revenue expenses. We have set ambitious targets for InterCity. Clearly they have not been met for the past year and are unlikely to be met this year, because of the effects of the recession, but they are certainly more modest than the targets that would apply to the private sector, and do not entail the sort of return on assets that a private sector bus operator, airline, or any other provider of transport, would expect. However, it is not a social service, and British Rail is right to seek to protect its bottom line and to adjust the services it provides to strive to meet the objectives that we have set.
My hon. Friend asks whether British Rail is fair to blame the Government. If he is referring to the objectives that we have set for it, I am unrepentant. It is important that BR has targets to meet. It has not done so this year, but those targets are modest and, in a reasonable economic climate, achievable. I am sure that my hon. Friend would be happy for BR to achieve those targets in its commercial services.
The second, more important, question relates to the implications of our BR privatisation proposals for the service from Cleethorpes to London. I very much hope that the private sector will consider that service. I hope that the debate will stimulate its interest. In the past few weeks, I have spoken to several dozen potential freight and passenger service operators and a number would be interested in running such a service.
My hon. Friend wrote to me about the loading factors yesterday and he might be interested to know about them. British Rail has told me that passenger numbers on the two InterCity services between Newark and Cleethorpes are very low and have fallen in recent years. The south-bound morning train carried on average 170 in 1987, falling to 120 in 1990 and further to 90 in 1991. The corresponding figures for the evening return train were 130 in 1987, 100 in 1990, and 90 in 1991. So there are now barely 100 passengers to be found on a train with a capacity of 480.

Mr. Michael Brown: I am grateful to my hon. Friend for obtaining those interesting and helpful figures for me. I am also grateful to him for kindly agreeing to meet a delegation next week from the hon. Member for Great Grimsby (Mr. Mitchell) and myself. I can give my hon. Friend the reason for the fall in passengers. Those who are on a tight budget now wait until 9.30 before using the super-saver ticket on the train to Newark, where they change. If that super-saver ticket was once again available on the direct train, more people would use it.

Mr. Freeman: I have much sympathy with my hon. Friend's argument. Our proposal for franchising passenger services will permit the operator of a privately run train to make such crucial decisions about pricing in order to tap the market.
Our legislative policies, which we hope will receive Royal Assent next year, will open access so that private operators are encouraged to run new services and franchise existing services. Next year, BR may decide to withdraw the Cleethorpes service. I have no power to stop it doing so—that commercial judgment is its responsibility.
A private sector operator may consider the loading factors and find them depressing. However, it might believe that the service could be improved if the fare structure was altered, the service was better marketed and the times of the trains were changed. Any such timetable change, however, would have to be negotiated with BR. We propose a right of appeal to a regulator should it be impossible to reach agreement between the potential operator of any particular service and BR.
A new operator may consider introducing the changes I have described and may consider introducing on-board services such as providing coffee and a newspaper for every commuter from Great Grimsby. Many private sector operators want to change the quality of such services and the timing of the trains.
There is a lot to play for. I hope that the private sector will not be put off by the raw figures. I am sure that my hon. Friend will be interested to know that the cost of running the diesel through-train service is £1 million a year. That train travels in the morning from Cleethorpes to London—presumably it stays there for part of the day—and returns in the evening. That figure includes


operation costs, which are exacerbated by the need to provide on-train door assistance at stations with short platforms, and cleaning facilities at Cleethorpes.
The extra revenue for the portion between Newark and Cleethorpes is some £300,000 a year. Therefore, British Rail calculates a saving of £700,000 by withdrawing the service, on the assumption that passengers will transfer to other British Rail services and use east coast main line service trains where additional capacity exists. So no extra cost is entailed in providing that service.
There is a prize for British Rail for improving profitability, but also an opportunity for the private sector.

When my hon. Friend comes to see me next week with the hon. Member for Great Grimsby, I shall rehearse at greater length the exciting challenge for the private sector in franchising and operating services on British Rail. I cannot foresee whether that will mean that a private sector train will be able to provide through services if British Rail withdraws them. There are 12 months to go, but the Government certainly intend to open up those opportunities, and I hope that they will be grasped.

Question put and agreed to.

Adjourned accordingly at ten minutes past Twelve o'clock.